Russian refinery damage escalates after latest Ukrainian drone strike

• Strikes affect almost 1 million b/d gross capacity
• Ukraine using bigger explosives with 'steel balls' in drones
• Russian oil products exports at postpandemic low

Russian refining capacity damaged by Ukrainian drone strikes rose further over the weekend May 18-19 to almost 1 million b/d after the 70,000 b/d Slavyansk oil refinery in the southern Krasnodar region was forced offline, according to local reports.

The Slavyansk refinery -- which was previously struck on April 27 and March 17 -- was targeted by six drones May 18-19, Russia's state-run news agency TASS reported May 20, citing a company security official.

TASS quoted the security official, Eduard Trudnev, as saying that the Ukrainian drones were bigger and more powerful than in previous attacks.

"This time the drones were bigger, the charges were bigger too, and they were stuffed with steel balls," TASS cited Trudnev as saying.

TASS cited the press service of the regional administration saying, however, that no fires were recorded after the drone attack.

Slavyansk, a small export-oriented plant near the Black Sea, was last targeted three weeks previously, when an April 27 attack was suspected to have left a naphtha separation column damaged. A previous attempt on the site left a crude distillation unit and a vacuum distillation unit offline, though full operations were restored within a month.

The attack comes two days after Ukraine launched a major strike on oil infrastructure in occupied Crimea and other Russian Black Sea oil infrastructure. Drone strikes May 17 caused fires at Rosneft's 240,000 b/d Tuapse refinery, which had only recently been restarted following a previous incident in January.

Russia has alleged that French-made missiles were discovered in the Yubileiny settlement in occupied Luhansk May 20, while US artillery has been fired over Crimea, according to TASS May 20. Meanwhile, attacks deep within Russian territory continue to be conducted with domestically-produced Ukrainian drones even as its Western allies have stipulated military aid should only be used for defensive purposes.

Export impact
Combined, Russia's gross refining capacity potentially affected by drone strikes now stands at almost 1 million b/d, up from about 680,000 b/d on May 10, according to S&P Global Commodity Insights estimates.

Russian oil products exports slumped to a postpandemic low in April, according to tanker tracking data, as Moscow battles to repair its western refineries under siege from Ukrainian drones.

Russia's biggest fuel exports -- diesel and gasoil -- have continued to shrink this month, averaging 686,000 b/d to May 20, down a further 130,000 b/d from April and 405,000 b/d lower than in January, according to S&P Global Commodities at Sea.

High stock levels, in excess of 2 million mt, coupled with ample availability on the exchange floor were keeping a cap on gasoline prices in Russia's domestic market and offsetting the upside momentum linked to the expected lifting of the export ban, according to sources May 17.

Strikes on the month/ongoing damage:

Source: S&P Global Commodity Insights, local reports