Ukraine’s strategy to starve Moscow’s war machine of revenue and fuel can work. The U.S. should support, not oppose it.
OPINION / EXPERT PERSPECTIVE — Bystander video feeds show scenes of fire and destruction, flames engulfing pipelines and smoke billowing from oil tank farms. In one clip, a twin-tailed aircraft flies slowly over a burning refinery. It loiters, banks, and then plunges precisely into the top of a tall, hydrocarbon filled distillation tower followed by explosions and more fire.
Kyiv is turning the tables on Russia by striking at its hydrocarbon lifeblood. Ukraine’s justified and effective homegrown response to Putin’s two-year campaign of attacks on the nation’s energy infrastructure shows Russia that what goes around comes around.
Instead of supporting the initiative, Washington is reportedly urging a halt to the strikes with The Financial Times citing sources who say that message has been delivered to the Ukrainian intelligence services.
Given the military, economic, and psychological benefits of smacking Russia refineries, why is the Biden administration pressing Ukraine to stop?
Fear of Russian escalation or retaliation has been a persistent theme in the Biden administration. Nevertheless, time after time Ukraine has pushed past Russian red lines with attacks on the Kerch Straits bridge, the Russia Black Sea Fleet, and other targets inside Russia.
One worry is that reduced Russian exports will raise prices at the pump for U.S. drivers, fueling inflation and hurting re-election prospects in November. But U.S. and global oil prices are artificially high because OPEC plus nations have restrained production, not because Ukraine has damaged Russian assets.
Any reduced supply to markets can and should be offset by increased production by the U.S., Saudi, and other OPEC countries to keep prices stable. This war has shown that energy markets are resilient and adaptable.
Subscriber+Members have a higher level of access to Cipher Brief Expert Perspectives and get exclusive access to The Dead Drop, the best national security gossip publication, if we do say so ourselves. Find out what you’re missing. Upgrade your access to Subscriber+ now.
Since the beginning of 2024, Ukraine’s unmanned air force has hit at least 12 Russian refineries which together are responsible for almost 30% of Russia’s refining capacity. Damage is still being assessed, but critical distillation units can take years to repair or replace. Russia is learning that countries that live in gas houses shouldn’t throw drones.
The CEO of the oil trading giant Gunvor estimates that 600,000 barrels a day of vital diesel production has been taken out, while JP Morgan has estimated that about 900,000 barrels of refinery production is offline. Lucrative diesel and refined products exports declined 10 percent in January 2024, while “attacks on energy infrastructure have idled around 7% of refining capacity in the first quarter” according to Reuters analysis. This translates into lower foreign earnings, and less fuel for the front.
With Russian refineries unable to absorb crude oil production, Russia is dumping additional oil barrels on world markets. Russian crude exports, far less profitable than refined products, increased by 10 percent in February, almost exactly the amount by which refined product exports decreased. Gas prices at the pump are rising for Russian motorists. This is good news.
With a new military aid package stalled in Congress, Ukrainian strikes on Russian energy facilities are a case study of effective asymmetric warfare that recognizes the nature of its opponent and its sources of power and weakness.
We, the U.S., talk a lot about asymmetric warfare. Ukraine is executing it in a way that compliments other elements of power and helps compensate for slow-rolling energy Western sanctions and arms deliveries.
Ukraine’s air campaign is not the first time a nation’s critical energy infrastructure has been attacked with long range drones. Years before, Russia used hundreds of Iranian supplied Shahed drones to target Ukraine’s power generation and energy grid, Yemen’s Houthis used drones to attack Saudi oil assets. In 2019, Iran struck Saudi Arabia’s sprawling Abqaiq oil processing complex with cruise missiles and drones, severely damaging the facility, and coming close to shutting off almost 50 percent of Saudi exports.
Ukraine’s MacGyvered air operations have also highlighted the inability of Russia’s Air Defense Forces to protect its vital and now clearly vulnerable hydrocarbon infrastructure. If Russia can’t counter unmanned, slow-flying, propeller-driven drones penetrating deep into the country, how could it hope to intercept F-35s or B-2s? Some soon-to-be-fired Russian Generals have got some explaining to do.
The morale boosting news stemming from Ukraine’s strikes on Russian refineries offers a glimpse of what must be done to end Russia’s dream of conquering Ukraine. Taking out the black gold money machine is one element needed to reduce Russia’s ability to wage war and bring it to the negotiating table on Ukraine’s terms.
It’s not just for the President anymore. Cipher Brief Subscriber+Members have access to their own Open Source Daily Brief, keeping you up to date on global events impacting national security. It pays to be a Subscriber+Member.
The U.S. and Europe have unsuccessfully tried to starve Russia’s energy industry of revenue with sanctions and price caps while at the same time not upsetting oil markets or raising domestic prices. Willing buyers, ghost fleets, and war-profiteering middlemen have ensured that Russian oil continues to flow to world markets while dollars and euros continue to flow into Kremlin coffers.
Burning Russian oil at the source is the one sure way to prevent sales to China, India, Turkey, and others happy to provide Putin with the cash needed to fuel his atrocities abroad and oppression at home.
Facing nothing less than annihilation, Ukraine’s core interest in is winning the war, not whether Western drivers pay a few more cents per gallon. Ukraine should not only sustain the refinery attacks but take them to the next level of hitting key pipeline nodes and export terminals to truly impact Russia exports and revenue generation.
America should support Ukraine’s efforts to use its own weapons to reduce Russia’s oil revenue and war waging capability. At the same time, we must move more quickly and decisively on military aid, sanctions enhancement, and diplomatic initiatives to pressure Russia to end its war of choice.
Paul Kolbe is a Senior Fellow at the Harvard Kennedy School Belfer Center. He previously served 25 years as a senior CIA operations officer focused on Russia and 10 years in the energy sector with BP.
Who’s Reading this? More than 500K of the most influential national security experts in the world. Need full access to what the experts are reading?
Read more expert-driven national security insights, perspective and analysis in The Cipher Brief
