Thread by @Mylovanov

Ukraine has (again!) hit two oil refineries in Russia.

While this is great for Ukraine, the U.S. is concerned about attacks rising the world price of oil. This argument is silly.

These attacks will force Russia to export more, not less, and the data supports this 1/

The argument above is basically Econ 101: if Russia can’t refine oil into diesel and petrol domestically, it’s stuck with oil. So, it will export it!

There are two auxiliary arguments for this to be true. Russian storage capacity has to be limited. And it won’t but down wells 2/

Michael Liebreich, Lauri Myllyvirta, and Sam Winter-Levy argue exactly this in Foreign Affairs. A recommended reading, really.

The data supports them. Russia is exporting more crude, while its refined exports have hit near-historic lows. 3/

foreignaffairs.com/ukraine/why-uk…

I quite: Moscow exported just over 712,000 tons of diesel and other petroleum products in the last week of April, a drop from more than 844,000 tons in the same week in 2023. 4/

Monthly exports of crude oil, however, increased by nine percent from February to March, reaching their highest level in nine months and their third highest since Western sanctions on Russian crude oil took effect in December 2022. 5:

You can also measure the success of Ukrainian attacks by the amount of production capacity destroyed - over 14% 5/

https://twitter.com/mylovanov/status/1786043742777999856

More recently, Ukraine has achieved capabilities to strike even larger distances - a Gazprom refinery in Bashkir Republic 1400 km from UA border. 6/

This Gazprom refinery is one of Russia's largest oil refining and petrochemical production complexes. It specializes in the production of gasoline, diesel fuel and other types of petroleum products. In 2022, the Salavat refinery processed 6.7 million tons of oil. 7/

Bloomberg writes that the attacks impose lasting damage.

Rosneft's Tuapse plant, hit at the end of January, remains offline, while other damaged refineries owned by Rosneft and Lukoil have not recovered to pre-attack levels. 8/

bloomberg.com/news/articles/…

Many people, including the U.S. officials, specific Secretary Austin, have criticized Ukraine targeting of our refineries, arguing that there are other, better, more important targets.

Well, there is a counter argument to that too 6/

https://twitter.com/mylovanov/status/1786042782223610068

So, Ukraine has already shown it can deteriorate the Russian navy. Now it shows it can do the same to the oil refinery industry 7X

And the U.S. crocuses of these attacks is gradually coming to a stop.

https://twitter.com/arturrehi/status/1788564992825938300