Russia Promises To Defend Oil Infrastructure With Missiles

Russia's energy ministry has promised to defend its oil and gas infrastructure against Ukranian strikes with missiles, Reuters reported on Tuesday.

Artyom Verkhov, the director of the energy ministry's department for gas industry development, has said that a defensive system is already in the works.

"We are jointly working, including with colleagues from the Russian National Guard, to cover objects, on installing, accordingly, protection systems such as Pantsir," Verkhov said.

Ukrainian strikes have so far taken nearly between 370,000 and 900,000 bpd worth of Russia's refining capacity offline, depending on which analyst estimates are used.

Ukraine has carried out a string of refinery attacks using drones in the past few weeks, inflicting significant damage -according to Security Services of Ukraine-to 12 oil and gas processing facilities throughout Russia. With Russia's refining capacity for Q2 now reduced from missile strikes and seasonal planned and unplanned refinery maintenance expected to take place this quarter, the world's largest fuel exporter could find its revenues curtailed.

According to Bloomberg, Ukraine has targeted a collection of Russian oil refineries that account for 12% of Russia's oil-processing capacity.

Russia already said at the last OPEC+ meeting that it was planning to curb oil production by 350,000 bpd in April, resulting in export cuts of 121,000 bpd. For May, Russia's production cuts of crude oil are set to climb to 400,000 bpd, with export cuts of 71,000 bpd.

With Russia being unable to process as much crude oil into products as it had originally planned, its crude oil exports may increase, as the country has limited oil storage capacity.

Russia's President Vladimir Putin claimed an election victory on Monday amidst the refinery attacks, securing 87% of the vote.

By Julianne Geiger for Oilprice.com

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