Russia is targeting oil infrastructure: why there won’t be a shortage and what will keep prices in check
14 January 17:01
ЕКСкЛЮЗИВ
Following Russian strikes on the Odesa region, which damaged warehouses, oil tankers, and vehicles, concerns have resurfaced in the public sphere regarding a potential shortage or sharp rise in sunflower oil prices in Ukraine. Experts, however, assess the impact of these losses on the domestic market as limited.
Economist Andriy Novak commented
“Today, Russia’s strikes on the Odesa region, where oil tankers, oil warehouses, and vehicles were damaged, certainly represent direct losses for these businesses.
But for the Ukrainian market, this will have no impact whatsoever on the range of these products, their quantity, or their price.”
According to him, the Ukrainian food market, particularly the oil market, is oversaturated, and losses of even several thousand tons are not critical on a national scale.
“And so, the loss of a few tons, or dozens, or even thousands of tons—this is not that critical for the entire Ukrainian market.
But for the company that owned this oil, it is certainly a loss.”
Novak does not rule out that the affected companies may be eligible for state compensation.
Economist Oleg Pendzin commented [Komersant] drew attention to the market’s structural indicators.
“Do you know how much oil Ukraine produces per year? Five million tons. And do you know how much the domestic market consumes per year? Five hundred thousand tons. Ninety percent of what we produce, we export. Do you think a shortage could arise under these conditions? Hardly.”
Thus, even damage to infrastructure does not pose a risk of oil shortages specifically for Ukrainian consumers.
Pendzin notes that the key constraint on price increases is the population’s purchasing power.
“The market price for oil today is 60–70 UAH; you’ll probably go looking for it where it’s cheaper… We have a pretty wide selection, don’t we? Both brands and store brands.”
According to him, even if production costs rise due to blackouts and logistical losses, consumers are not willing to pay significantly more.
“The main obstacle to selling a liter of oil at a higher price than today’s is the thickness of the Ukrainian citizen’s wallet.”
The economist emphasizes that any price increase will be limited.
“If there is an increase at all, it will be no more than, say, 10%, over a month or a month and a half.
So, as for a shortage, there definitely won’t be one. As for the price, yes, it will rise, but not significantly.”
Attacks on the oilseed industry’s infrastructure have caused localized economic damage but do not pose a threat to the domestic market.
Massive attacks on oil infrastructure
In December 2025, Russian forces launched a series of strikes on infrastructure in the Odesa region, including the Allseeds Black Sea sunflower oil transshipment terminal—one of the key facilities for the storage and export of vegetable oil. As a result of these shellings, tanks and warehouses were damaged, leading to fires and the loss of a significant amount of oil.
Russian attacks also affected key enterprises in the industry:
- the Bunge plant in Dnipro, where products are manufactured under the “Oleina” brand;
- the Allseeds terminal at the Pivdennyi port;
- the Kernel oil and fat plant in Chornomorsk.
Consequences of the attacks
- Production facilities at the Bunge plant in Dnipro were damaged, but there were no casualties; the company is working with local authorities to resume operations.
- Following the attack in Dnipro, approximately 300 tons of oil spilled onto the roads, disrupting traffic in the city for 2–3 days.
- In Chornomorsk, a fire broke out in a vegetable oil storage tank, resulting in a product leak.
- At the Pivdennyi Port, a vegetable oil spill into the water was recorded during the massive attacks, temporarily restricting port operations.
Company Responses
Bunge reports on damage assessments and prioritizes employee safety. The company has already begun measures to resume production. Kernel is also monitoring the situation at its plant and addressing the consequences of the spill.
Widespread environmental consequences
As reported by the media, the strikes caused an oil spill into the Sukhoi Liman water area, where at least 125 tons of the product entered the water body and caused significant environmental damage, estimated at billions of hryvnias.
