Russia will retain the ability to produce and export most of its oil, but sustained Ukrainian strikes will erode its refining capacity, exacerbate domestic fuel shortages and increase the risk of deeper production cuts, leaving Moscow with less fiscal room, but these disruptions are unlikely to force the Kremlin to scale down its war effort in the short term. On July 10, the International Energy Agency (IEA) lowered its forecast for Russian oil production in 2026 and 2027, citing continued Ukrainian strikes against Russian energy infrastructure. The agency now expects Russian oil production to average 8.9 million barrels per day (bpd) in 2026 and 8.8 million bpd in 2027, down from 9.2 million bpd in 2025, representing reductions of 85,000 bpd and 150,000 bpd, respectively, relative to its previous forecasts. The downgrade follows months of Ukrainian drone and missile strikes targeting refineries, storage facilities, pumping stations and export infrastructure across...
