Ukraine’s attacks on Russian refineries could ignite a new energy shock

July 13, 2026 — 11:59am

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As if the new outbreak of the conflict in the Middle East weren’t a sufficient threat to the global energy market, last week Russia banned exports of diesel and caused the price of diesel to soar.

In Europe, the premium that benchmark diesel futures held over the crude oil price jumped to more than $US60 a barrel, its highest level in more than 15 years. Before the US and Israel attacks on Iran, that spread was just above $US20 a barrel.

In the US, diesel futures rose nearly 12 per cent to $US154.71 a barrel, the most in four years, to their highest level in more than a month.

Until relatively recently, Russia was the world’s number two exporter of diesel. Ukraine’s targeting of its oil refineries – it has struck almost all the country’s major refineries – has taken out about a quarter of Russia’s refining capacity. That’s had a dramatic impact on Russia’s production of diesel which, even before last week’s export ban, was running at less than half the level of a year earlier.

Russia now produces only about two-thirds of the fuels it needs to meet its domestic demand.

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Rationing of petrol and diesel in most of its regions has Russians queuing for up to 24 hours, or even longer, for gasoline and diesel in amounts that are capped at quite meagre levels, and at prices nearly 20 per cent above their pre-war levels. Moscow has also ended exports that were running at about 700,000 to 800,000 barrels a day before Ukraine’s attacks forced them to be cut last month to about 260,000 barrels a day, and has said it will now start importing fuel.

Russia has ordered........

© The Age