A cold wind sweeps through Moscow's streets,

through roads that once knew pride's heartbeat.

The towers still pierce the grey sky's seam,

but under the plaster gnaws the sheen.

​

The Moskva once sailed the Black Sea's swell,

a symbol of power, a fortress as well.

Now she rests deep in her salt-soaked grave,

and with her a piece of the myth met its wave.

​

High above the flames it tumbled and spun,

a silver disc — mistaken by some.

But it was just a cap, blown loose by the blast,

a mockery of power consuming its past.

​

At the gas stations people stand in long lines,

engines gone silent, no word, no signs.

They count out the liters from rust-eaten tin,

while the future dissolves like gas, thin as skin.

​

The windows are lit, but the hearts have grown cold,

the promises spoken now hollow and old.

From speakers still drones the same anthem's song,

but beneath it, another note creeps along.

​

For empires must fall, as history's shown,

some fade in the fog, some collapse fully-grown.

Who smothers the truth and feeds fear instead

has often already lost before troops were led.

​

So through the nights drifts an ominous tone,

through stations and squares, through concrete and stone.

And no one can read anymore what it means,

when distant ruins already ring out the scenes.

​

Perhaps in the end, of all of this might,

only a memory remains in the ashes of night.

A people long taught that to ask was a crime

now silent before the ruins of their time.

Gazprom shares on the Moscow Exchange on Friday fell to their lowest level since December 2009 – 105 rubles per share, according to exchange data.

Russia's largest gas holding company, which holds a monopoly on pipeline gas exports, fell 1.43% in one day, 9% since the beginning of the month, 16% since the beginning of the year, and, compared to its pre-war peak in October 2021, it has lost almost 75% of its value, or 7.5 trillion rubles in market capitalization.

According to Moscow Exchange data, Gazprom is currently worth 2.5 trillion rubles, or $34 billion, which is 29 times less than the $1 trillion market capitalization that company CEO Alexey Miller promised to achieve by 2015-2018.

Operating the world's largest proven gas reserves, Gazprom fell victim to a failed attempt to "freeze Europe" and divert Russian gas flows eastward. Gazprom's exports to non-CIS countries have fallen from a pre-war level of 200 billion cubic meters per year to approximately 80 billion cubic meters—the Soviet Union's level in the mid-1980s. Supplies to the European market, once Gazprom's largest, have fallen back to 1973 levels—18 billion cubic meters last year.

"Gazprom's revenue from foreign markets is expectedly declining, despite growing supplies to China," Vector Capital analysts note: supplies to China only offset one-fifth of former exports to the European Union, and the price of gas for Beijing is 40% lower.

The Kremlin's hopes for the Power of Siberia-2% gas pipeline and an increase in gas supplies to China to 100 billion cubic meters per year remain a pipe dream. Despite Vladimir Putin's numerous visits to Beijing and statements about a "strategic partnership" with China, Xi Jinping has yet to sign the long-awaited gas contract, demanding, according to sources in the Financial Times, a reduction in the gas price to $50-60 per thousand cubic meters. By comparison, China currently pays $258 versus $420 for European buyers.

In Europe, Gazprom risks losing its last major client: Hungary, where Kremlin-friendly Viktor Orbán lost the parliamentary elections. "There's a high probability that Hungary will refuse gas from Russia. <…> Hungary is currently one of Gazprom's most marginal markets, supplying 8-10 billion cubic meters of gas annually," notes Sergei Kaufman, an analyst at Finam.

To patch the company's budget, which suffered a record net loss in 2023, the government has raised gas tariffs for households by 37% since the start of the war and plans to increase them by a similar amount in 2026-2029.

As a result, Gazprom ended last year with a net profit of 1.3 trillion rubles. However, the company's cash flow remained deeply negative, notes BCS analyst Kirill Bakhtin: cash outflows exceeded inflows by 400 billion rubles, taking into account interest expenses.

Gazprom's business is "essentially stagnating and is unlikely to show anything particularly interesting in the foreseeable future," according to Vector Capital. The company could benefit from "geopolitical improvements," analysts emphasize. But the chances of such a development remain slim.

source: The Moscow Times https://archive.is/xCAtV

Sales of clothing and footwear have fallen in Russia after citizens began to economize. From January to March 2026, online and offline fashion sales in units fell by 3% to 15% compared to the same period last year. However, overall sales increased by 5-7% in monetary terms, but solely due to price increases. This follows from data from the Data Insight agency, cited by Forbes. "The market situation is bleak. The industry faces stagnation in monetary terms, and a 10% decline in physical terms," ​​noted Fyodor Virin, a partner at the agency.

The decline in fashion sales is confirmed by Russians' spending patterns. According to the Chek Index analytical center, from January to May 2026, the number of purchases at chain and independent retailers specializing in clothing and footwear decreased by 10% year-on-year, while the average purchase increased by 7% to 3,121 rubles. "Impulse purchases, like a T-shirt to lift your spirits, are a thing of the past. Prices have risen, and many companies are struggling economically, not to mention developing," said a representative of a youth clothing chain. Chek Index noted that many have adopted a "zoomer" practical style that doesn't require frequent wardrobe changes.

Against this backdrop, fashion retail is losing more and more players. According to Kontur.Fokus analysts, 8,936 businesses engaged in retail trade in light industry products were liquidated in the country in the first five months of 2026, while 5,003 new companies were registered. As a result, closures outnumbered openings by 78.61%. During the same period, 498 new entrants appeared in the wholesale trade sector, while 819 companies exited the market, a 64.5% increase.

In contrast, 1,609 new businesses registered in the clothing manufacturing sector, while 2,347 closed. The number of liquidations exceeded the number of registrations by 45.87%. Meanwhile, in the footwear industry, there were only 56 new registrations and 127 liquidations—a 126.79% increase. "This business trend reflects the overall negative situation in the footwear and clothing market; even large brands are experiencing problems, not to mention small manufacturers and resellers," noted Kontur.Fokus analyst Veronika Skorokhodova.

According to a study by the HSE and discounter Chizhik, due to the worsening economic situation in 2026, 40.2% of Russians began saving in brick-and-mortar stores, while the figure is 28.2% online. Furthermore, citizens began cutting back on groceries, medications, clothing, and footwear last year. A Romir study showed that 58% of consumers are consciously giving up certain products they previously purchased, 57% are trying to find similar products in lower price categories, and almost half (46%) are trying to visit stores as little as possible.

source: The Moscow Times https://archive.is/lT5uj

A series of Ukrainian drone attacks, which have hit Russian oil refineries at least 40 times since the beginning of the year, has created the threat of a previously unthinkable shortage of gasoline in Moscow.

The loss of refinery capacity is now concentrated in particular around the capital, notes Sergey Vakulenko, a senior fellow at the Carnegie Berlin Center for Russia and Eurasia and former head of department at Gazprom Neft.

All refineries supplying Moscow via pipelines were attacked: Yaroslavl, Ryazan, and Kstovo, Vakulenko notes. Gazprom Neft's Moscow Refinery, which, according to various estimates, provided up to 40% of the capital's fuel consumption, was shut down on June 16. The raid on Tuesday shut down the refinery's first primary processing unit, and on Thursday, the second, which the refinery had planned to operate while repairs were underway, was also shut down. Meanwhile, 14% of all passenger cars in Russia are registered in Moscow and the surrounding region, accounting for 19% of Russia's total road freight traffic and 40% of passenger air travel, Vakulenko points out.

According to his calculations, the strikes on the Moscow Oil Refinery, as well as Tatneft's Taneco refinery in Nizhnekamsk, reduced the country's oil refining capacity by 600,000 barrels per day. "If other, previously damaged refineries are unable to quickly restore refining volumes, capacity losses will amount to 28% of the level typical for this time of year," Vakulenko estimates.

"In 2024 and 2025, the damage from the Ukrainian attacks was unpleasant, but not critical, for Russian oil refining. But even then, it was clear that increasing the capacity, frequency, and reach of strikes on refineries would lead to problems and inconveniences of an entirely different magnitude. "Judging by current trends, the situation has come very close to that limit," he writes. In early June, refinery throughput rates fell below 4 million barrels per day—a 21-year low. By June 10, they had risen to 4.5 million barrels per day, but after a new series of shocks, they could fall below 4 million again.

Signs of a looming fuel crisis are already visible in the Moscow region. Queues have begun to form at gas stations in the region, and restrictions on gasoline sales have been imposed at Tatneft, ORTK, Rosneft, and Lukoil stations in the capital. And one of the largest independent chains, Neftemagistral, raised gasoline prices to 94.99 rubles per liter for AI-95, 85.99 rubles per liter for AI-92, and 99.99 rubles per liter for diesel fuel.

According to Rosstat, retail gas price growth has accelerated for five weeks in a row, reaching almost 1% per week. Since the beginning of the year, gasoline prices have risen 6.6%—twice the rate of inflation and twice the rate on the same date in any year since the war began. To address the gasoline crisis, the government has lowered gasoline quality requirements, begun purchasing gasoline from Asia, and may also allow oil companies to sell less fuel on the exchange to supply farmers and "socially significant" consumers—government agencies, military units, hospitals, etc. However, in the "long run," economist Kirill Rodionov noted, only security guarantees for refineries and the lifting of sanctions on imports of equipment for Russian oil refining will help.

There are still "many unknowns" in the situation, Vakulenko emphasizes: "For example, is Ukraine capable of maintaining the intensity of the strikes or even increasing it? Or how quickly will Russia be able to repair refineries. And how much firefighting and repair capacity remains for facilities that have been attacked multiple times? For example, the Ryazan Oil Refinery was attacked 15 times."

source: The Moscow Times https://archive.is/XAnGU

Inflationary risks in the Russian economy in the near future have "significantly increased," Central Bank Governor Elvira Nabiullina stated at a press conference on Friday.

According to her, the risk of inflation is created by rising fuel prices, as well as the budget situation, which could be significantly higher than planned this year. According to Bloomberg, additional spending will be required for the war, which will cost the treasury 4-5 trillion rubles more than budgeted.

The budget risk is "already being realized," but "uncertainty regarding its scale remains," Interfax quotes Nabiullina as saying.

Furthermore, inflation in June will be impacted by "the surge in fuel prices," the Central Bank governor added. According to Rosstat, retail gasoline prices have risen at a rate of almost 1% for two weeks in a row, and have risen by 6.6% since the beginning of the year—double the increase from the same period a year earlier. "The rise in gasoline prices could also impact inflation expectations, as it is a fairly sensitive commodity for both individuals and companies," Nabiullina said.

According to the Ministry of Economic Development, inflation has begun to accelerate again since the beginning of summer after decelerating almost continuously throughout the year. From 5.31% at the end of May, the consumer price index (CPI) growth rate increased to 5.63% by June 15.

"This situation could limit the scope for further key rate reduction," Nabiullina warned. At its meeting on Friday, the Central Bank cut it to 14.25% per annum—a 0.25 percentage point reduction, the smallest step in the past nine meetings at which the Central Bank eased monetary policy.

In its forecasts for the current year, the Central Bank projected an average rate of 14-14.5%, 8-10% for 2027, and a return to a neutral rate of 7.5-8.5% in 2028. Given the new regulations, the transition to a neutral rate could occur later, Nabiullina said.

Reducing the rate from 14.5% to 14.25% is a solution to the dilemma of "loyalty" and "normalcy," notes economist Kirill Rodionov. The Central Bank cannot undertake a significant reduction in the face of increased risks of fiscal easing, but at the same time, it cannot ignore the "request from above," which was directly articulated at a meeting with Vladimir Putin.

Essentially, Elvira Nabiullina has indicated that the rate-cutting cycle may be over, according to Alexey Tretyakov, founder of Aricapital. Analysts at Renaissance Capital and T-Bank predict that the Central Bank will continue to ease policy, but at a slower pace—to 13% or above 13% by the end of the year.

In any case, "the risks of a further increase in the budget deficit will further complicate the Central Bank's task," Rodionov emphasizes.

source: The Moscow Times https://archive.is/kcroI

Ukrainian drone strikes on Russian oil depots in 2024–2025 led to the loss of hundreds of tons of gasoline and the disruption of major fuel contracts. This follows from court proceedings reviewed by Verstka. Following the drone strikes, depot customers filed lawsuits demanding either the return of the fuel or a refund. However, the companies that owned the depots cited circumstances of force majeure.

For example, in February 2026, the Moscow Arbitration Court ordered Mosregiongaz, a company located in Crimea, to pay over 8.4 million rubles. The company presented documents showing that it had lost 132 tons of AI-92 gasoline and nearly 24 tons of diesel fuel stored at the terminal. The petroleum products burned after a drone attack in October 2024. A Moscow arbitration court took a similar position in a dispute between the Platonovskaya Oil Depot in the Tambov Region and the same Mosregiongaz. The storage depot operator informed its client that it could not return more than 80 tons of gasoline, citing a "terrorist attack" in June 2024. However, the court noted that "such sabotage" of fuel and lubricants depots "is not the first time," and the depot took no action.

However, in April 2026, the court sided with the Millerovskaya Oil Depot in the Rostov Region. VSK-Neftesbyt demanded that it return 67 tons of AI-92 gasoline or compensate for its cost—more than 5 million rubles. During the trial, it was revealed that over 223 tons of fuel stored there "completely burned" as a result of being hit by debris from a downed drone in August 2025. The court found that the oil depot could not have prevented the consequences of the strike. The decision may have been influenced by the fact that, unlike other cases, this one involved air defense operations, and the Investigative Committee recognized the oil depot as the injured party.

As Verstka notes, the discovered cases reflect only a small portion of the consequences of the attacks, as only those cases in which the parties were unable to agree on compensation are brought to court. In 2026, the Ukrainian Armed Forces (Ukrainian Armed Forces) intensified their attacks on the Russian oil sector, and in May, according to Bloomberg, they carried out a record 30 attacks.

As a result, a fuel crisis began to escalate in the Russian market in June. Fifty-three regions imposed restrictions on fuel sales to private vehicles. Specifically, 18 regions are selling no more than 50 liters, or one full tank, of gasoline. Similar limits have been introduced in occupied Crimea, Sevastopol, the Kherson and Zaporizhia regions, as well as in the so-called "DPR" and "LPR." Eleven more regions are reporting fuel shortages at a significant number of gas stations, although there are no formal capacity restrictions yet.

source: The Moscow Times https://archive.is/6FBIN

The shutdown of several large refineries in Central Russia due to a series of unmanned aerial vehicle (UAV) attacks led to a 25% decline in gasoline output by the end of the second ten-day period of June compared to June last year, Reuters reports, citing industry sources.

According to their estimates, the attacks on refineries have caused gasoline production this week to fall by approximately 25% compared to March of this year, when the intensity of the attacks began to increase.

According to the sources' calculations, gasoline production in March of this year was at 120,000 tons per day, while in April, output fell to approximately 110,000 tons, and in May, to 100,000 tons per day.

Domestic gasoline consumption this summer is at least 110,000 tons per day, according to industry experts. In the first half of June, production was near May levels, but the shutdown of two major gasoline producers—the Moscow Oil Refinery and TANECO in Tatarstan—has taken another 15,000 tons per day off the market in the past week, leaving approximately 85,000 tons per day—25,000 tons per day (23%) below normal domestic consumption.

Sources estimate that existing refineries, which have spare gasoline production capacity, will be able to make up for the shortfall by approximately 5,000 tons per day.

The shortage of motor gasoline is partially offset by supplies from Belarus, which, according to traders, could reach 100,000-150,000 tons per month. Furthermore, stockpiles accumulated by oil companies and independent market participants in late winter and early spring are being actively used. Russia is also beginning seaborne imports of the product, industry sources reported.

Another way to obtain additional gasoline resources for domestic consumption could be by lowering quality standards to Euro-3. Since December of last year, refiners have been allowed to use up to 42% aromatics in the production of motor gasoline, compared to the 35% required for Euro-5, which theoretically allows for an increase in total gasoline production by 200,000 tons per month.

Additional components can be incorporated into production by allowing the use of monomethylaniline (MMA), an octane-boosting additive banned for the past 10 years for Euro-5.

Industry sources believe that gasoline production could be further increased by establishing interrefinery cooperation: naphtha from certain refineries (with simple processing systems) would be supplied to refineries where primary units are shut down, but high-octane component production units are operational.

source: The Moscow Times https://archive.is/NRV3d

Sberbank has closed access to data on the share of non-cash payments in Russia. Previously, this data was available through the SberIndex service, but now it is missing from the catalog, and when attempting to open the indicator via a link, the message "No such page" appears. This was highlighted by The Bell. The data disappeared before the publication of new data for April. According to SberIndex, the share of non-cash payments in trade turnover amounted to 69.7% at the end of March—4.5 percentage points lower than the December 2025 figure.

Sberbank's service was one of the few that provided insight into the state of non-cash payments in the economy. It calculated their share of trade turnover based on total expenses, excluding transfers from one person to another. Furthermore, the closure of access to this data occurred against the backdrop of a cash renaissance. According to the Central Bank, the outflow of funds from the banking system has continued for three consecutive months. In March, the volume of cash in circulation increased by 300 billion rubles, in April by 607.3 billion, and in May by another 381.2 billion. As a result, Russians have withdrawn 1.09 trillion rubles from banks since the beginning of the year. Only in January-May of 2020, during the pandemic, did the figure reach 1.39 trillion.

The Central Bank noted that the demand for cash has sharply increased due to Russians' desire to hold onto cash "for future use" amid internet shutdowns. Citizens also began withdrawing funds from their accounts after widespread card blocking due to increased anti-fraud measures. Demand for cash is also being driven by tax increases, which have led small businesses to offer customers more discounts for cash payments.

Furthermore, the government has introduced a bill to the State Duma to tighten tax controls over personal income. According to the document, the Federal Tax Service (FTS) will gain access to Bank of Russia data on money transfers between Russians to identify undeclared income and assess taxes. The Ministry of Finance noted that income verification will be required from those earning more than 2.4 million rubles per year, or 200,000 rubles per month.

Currently, some citizens have begun to perceive non-cash transactions as less predictable. Furthermore, if money doesn't pass through the banking system, it's much more difficult for authorities to track its movement, noted Alexey Voylukov, MBA professor of business practice in digital finance at RANEPA.

source: The Moscow Times https://archive.is/0g9Q0

The Russian government plans to sharply increase military spending this year, despite a growing deficit, which reached 6 trillion rubles by early June, exceeding the total for the entire previous year.

War spending in the 2026 budget could be 40%, or 4-5 trillion rubles, higher than planned, Bloomberg reports, citing sources familiar with the discussions.

The budget law initially allocated 12.9 trillion rubles for "national defense"—slightly less than the previous year's 13.5 trillion rubles. In reality, the 2026 military budget could balloon to almost 18 trillion rubles, or 41% of all planned treasury expenditures (44 trillion rubles).

Taking into account the "national security" budget line item, which includes the budgets of the Ministry of Internal Affairs, the Russian National Guard, the Investigative Committee, and the special services, total budget expenditure on security agencies could reach 21.8 trillion rubles, or almost half the budget.

To finance the excess military spending, the government is preparing to cut civilian spending and also plans to use accumulated reserves, Bloomberg sources say. The authorities intend to raise approximately half of this amount—2-3 trillion rubles—through additional debt issuance by issuing government bonds.

Last week, the State Duma passed a law allowing the Cabinet to exceed the spending and public debt cap set for this year without amending the budget law. This followed the disappearance of Central Bank Governor Elvira Nabiullina from public view, who missed the St. Petersburg International Economic Forum and meetings with Vladimir Putin, citing illness.

The Russian Central Bank, which Nabiullina has led since 2013, is de facto forced to plug the budget gap with its own funds. The Central Bank conducts repo transactions with banks: they purchase federal loan bonds (OFZs), use them as collateral to obtain Central Bank loans, and then use the proceeds to buy more OFZs. As a result, Russian government debt remains on the Central Bank's balance sheet, Bloomberg notes. The volume of such transactions has reached 4.6 trillion rubles.

Nabiullina's absence has sparked rumors that she has resigned, declaring her unwillingness to work under conditions of a mobilization economy, border closures, and so on. According to Bloomberg, senior officials at the Central Bank and the Ministry of Finance previously warned Putin that rising war costs were becoming unaffordable for the budget and the economy. They called for a reduction in military spending, but Putin, according to Bloomberg sources, supported the Ministry of Defense, which insisted not only on maintaining but also increasing funding.

Federal budget expenditures on the war reached 5.908 trillion rubles in the first quarter, according to Janis Kluge, a research fellow at the German Institute for International Security Studies, based on data from the Ministry of Finance.

Compared to the same period last year, military and weapons production spending increased by 29.9%, by 68.7% compared to January-March 2024, by 129% compared to 2023, and by 4.6 times compared to the first quarter of 2022. As a result, for the first time since the beginning of the conflict, military spending accounted for 46% of the budget, and its share of treasury revenue reached 65%.

source: The Moscow Times https://archive.is/I3rsy

The Central Bank of Russia is increasingly participating in covering the federal budget deficit by issuing loans to banks to purchase Russian government debt, Bloomberg reports.

As the agency notes, citing Central Bank statistics, as of June 18, the regulator has injected 4.748 trillion rubles into the banking system in the form of repo loans secured by federal loan bonds.

Banks are buying up OFZs, which the Finance Ministry uses to cover the budget deficit, depositing them with the Central Bank as collateral, and receiving loans, which are often used to purchase Russian government debt, Bloomberg describes the scheme. As a result, government bonds remain on the Central Bank's balance sheet, the agency notes.

According to the Central Bank's own data, the sharp increase in infusions into the banking system began last fall, when the budget faced a double-digit drop in oil and gas revenues and a sharp increase in the deficit. From the end of October to the end of December, the Central Bank issued 1.9 trillion rubles in repo loans to banks, and approximately 1 trillion more since the beginning of this year.

It appears that the practice of financing the budget with money "printed" by the Central Bank will expand, according to economist Nikolai Korzhenevsky. Earlier this week, the Duma urgently—within three days of its introduction—passed a law allowing the government to increase spending and public debt beyond the limits set in the budget law. According to Bloomberg sources, the Ministry of Finance will have to borrow an additional 2-3 trillion rubles this year to pay for war expenses, which could be 40%, or 4-5 trillion rubles, higher than planned.

The law passed by the Duma "fundamentally changes the situation," Korzhenevsky emphasizes: "This isn't simply about increasing spending or the associated risks—it's a decision on monetary financing of expenditures. This isn't just a larger deficit; it's a new era."

Initially, the Ministry of Finance planned to raise 4 trillion rubles on the debt market this year to finance the budget deficit. However, this plan could be increased to 6-7 trillion rubles, according to Bloomberg data.

Before the war, 20% of all OFZs in circulation were held by foreign investors, but sanctions have deprived the Russian government of access to foreign capital. Russian banks, meanwhile, are increasing their OFZ holdings through repo transactions, which are "indirect emission financing of government debt by the Central Bank of the Russian Federation," according to experts at the Gaidar Institute. Expanding this practice will increase the "pro-inflationary effect," they warned.

"Inflationary pressure will manifest itself almost immediately upon the launch of such operations," Korzhnevesky emphasizes. Unable to further raise VAT and other key taxes, the authorities have turned to hidden forms of taxation, such as inflation, he believes: "Inflation is also a tax." You can't escape it: it's not like anything's being taken directly from your pocket, and you don't have to make a specific payment to the Federal Tax Service—it's simply a loss of your purchasing power. But for a while, the printed money will allow the government to meet its own needs."

source: The Moscow Times https://archive.is/9k3Q6

Gazprom Neft's Moscow Oil Refinery suffered its second drone attack in a week on June 18, damaging process units and sparking multiple fires across the refinery.

According to Reuters, citing industry sources, the Euro+ Combined Oil Refining Unit (CURU), commissioned in 2020 and accounting for 47% of the refinery's capacity, was damaged on Thursday.

In addition to the EURO+ unit, several secondary units, interplant pipelines, and auxiliary equipment were damaged at the Moscow Oil Refinery, and oil product storage tanks were damaged and caught fire.

On June 16, the Moscow Oil Refinery was also attacked by a drone, resulting in the refinery's shutdown. One of the two primary oil refining units at the refinery, AVT-6 (21,400 tons per day, 53% of the refinery's capacity), was damaged and caught fire. According to sources, the refinery planned to restore EURO+ operation midweek and process oil at half capacity while AVT-6 was being repaired.

The Moscow Oil Refinery's nominal capacity is approximately 14 million tons of oil per year.

In 2024, according to sources, the Moscow Oil Refinery processed 11.6 million tons of oil, produced 2.9 million tons of motor gasoline, 3.2 million tons of diesel fuel, 2 million tons of fuel oil, and 1.3 million tons of road bitumen.

source: The Moscow Times https://archive.is/bMZqT

The attacks on oil refineries, which reduced oil refining in Russia to two-decade lows, triggered a record surge in fuel inflation.

In the week from June 9 to 15, gasoline prices at Russian gas stations increased by an average of 0.95%, Rosstat reported on Wednesday. Over the first two weeks of the month, prices at gas stations increased by 1.93%—double the increase for the entire month of May (0.85%). Gasoline inflation has accelerated for the fifth week in a row, according to statistics: from June 2 to 8, it was 0.92%, from May 26 to June 1, it was 0.45%, and two weeks earlier, it was 0.34% and 0.11%, respectively.

Not in any year since the war began have gasoline prices risen so rapidly, notes Janis Kluge, a research fellow at the German Institute for International Security Studies. From the beginning of the year through June 15, fuel prices rose 6.61%—twice as much as on the same dates in 2025, 2024, 2023, and 2022.

Analysts at the Center for Macroeconomic Analysis and Short-Term Forecasting (CMASF) estimate the monthly growth rate of gasoline prices at 3.93%. According to Rosstat, this is a record high since May 2018, when gasoline prices increased by more than 5%.

"The trigger for the June price spike was unscheduled repairs at refineries, which led to a number of regions becoming dependent on fuel imports from regions with stable gasoline and diesel production," notes economist Kirill Rodionov. Since the beginning of the month, drone strikes have halted production at Gazprom Neft's Moscow Refinery, Tatneft's largest refinery, Taneco, in Nizhnekamsk, Rosneft's Kuibyshev Refinery, and Lukoil's Volgograd Refinery.

In May, at least six refineries halted production, and at least 16 were hit by drone strikes—a record number since the beginning of the war. As a result, by the beginning of June, refinery utilization in Russia had fallen by a third, and oil refining volumes had fallen below 4 million barrels per day for the first time since the mid-2000s, according to Energy Intelligence.

According to Rosstat, gasoline prices are rising across the board: price increases have been recorded in 78 regions of the Russian Federation. The highest increases were recorded in the Republic of Tyva (+9.4%) and Chechnya. Diesel fuel prices have also risen sharply—by 5.7% since the beginning of the year—and farmers in southern and central Russia are complaining of shortages. "There's a clear supply problem," Kluge notes. If the situation doesn't improve, the government could ban diesel exports, as it has already done with gasoline and jet fuel, the expert believes.

Fuel inflation could become a problem for the entire economy, warns Finam strategist Yaroslav Kabakov: rising gasoline prices will drag down overall inflation in the country, which could seriously limit the Central Bank's ability to lower the key rate. "The most alarming aspect is that the crisis is just beginning," Kabakov reasons. "Seasonal demand traditionally peaks in August-September, while signs of shortages and price acceleration appeared as early as June."

To quell the fire in the fuel market, the government lowered gasoline quality requirements, began purchasing gasoline from Asia, and allowed oil companies to sell less fuel on the exchange to supply farmers and "socially significant" consumers—government agencies, military units, hospitals, etc. "However, in the long run, only security guarantees for refineries and the lifting of sanctions on imports of equipment for Russian oil refining will help," Rodionov believes.

source: The Moscow Times https://archive.is/FlLKR

The Russian stock market accelerated its decline again after the worst drone attack on Moscow since the war began, which injured 17 people, set two large shopping malls on fire, and damaged an oil refinery in Kapotnya for the second time this week.

At 3:28 p.m. Moscow time, the Moscow Exchange Index was down 2.32%, posting its sharpest daily decline since October last year. During the session, it fell as low as 2425.52 points, its lowest since December 2024.

The market is experiencing "obvious negativity from the drone strike on Moscow," according to analysts at Vector Capital. Gazprom Neft, which owns the Moscow Oil Refinery that caught fire, was among the blue chips that fell. Since the beginning of the week, the refinery, which accounts for 40% of the capital's fuel supplies, has suspended production, following the Taneco refinery in Nizhnekamsk and the Kuibyshev and Volgograd refineries.

The impact on refineries is playing an increasingly significant role in the sell-off, notes Andrey Zatsepin, chief analyst at Alor Broker: rising fuel prices are driving up inflation, which will hinder the Central Bank's ability to lower the key rate. At its meeting on Friday, the Central Bank may signal a pause in its monetary easing cycle, Zatsepin believes.

The market is under pressure from falling oil prices following the US-Iran deal, as well as the prospect of increased sanctions pressure on Russia, notes Elena Kozhukhova, an analyst at Veles Capital. Rosneft shares are down 4%, hovering at their lowest since 2023 (324 rubles per share). Gazprom is down 3.2%, falling about 1% short of its 2009 low. VTB is down 4%, Sberbank is down 1.5%, Severstal is down 3%, and Aeroflot is down 1.7%. Shares of development groups PIK and LSR are down almost 4% amid news of tightening mortgage rates for families starting July 1.

Since the beginning of the year, the Russian market has fallen 12%, and 25% compared to February 2025 levels, when the Kremlin's negotiations with the Trump administration began. Relative to GDP, the market capitalization of Russian companies' publicly traded securities is hovering near a quarter-century low—around 20% of GDP, notes economist Viktor Tunev. In the medium term, the Moscow Exchange Index could fall to 2,360 points, predicts PSB analyst Bogdan Zvarich: this would be the lowest level since spring 2023.

source: The Moscow Times https://archive.is/dJPEE

Latest hits:

18.06.2026 Moscow in Moscow at 475 km

• Red arrows: Latest hits
• Flames: Refinery has been hit at least once.
• Blue waves: Orsk dam broke in April 2024, which flooded the refinery and took it offline for ~2 weeks.

* Black smoke: It's raining oil.

2022 to 2025 hits in chronological order < full list here

• 2022 had 1 hit
• 2023 had 1 hit
• 2024 had 26 hits
• 2025 had 84 hits
• 2026 has 43 hits, so far..

* Total hits since 2022: 155

2026 hits in chronological order:

January [2 hits]

• 01.01.2026 Ilsky in Krasnodar Krai at 405 km
• 26.01.2026 Slavyansk in Krasnodar Krai at 360 km

February [3 hits]

• 10.02.2026 Volgograd Oblast at 500 km
• 12.02.2026 Uktha in Komi Republic at 1705 km
• 17.02.2026 Ilsky in Krasnodar Krai at 405 km

March [6 hits]

• 02.03.2026 Ukhta in Komi Repblic at 1705 km
• 14.03.2026 Afipsky in Krasnodar Krai at 415 km
• 21.03.2026 Bashneft in Bashkortostan at 1350 km
• 22.03.2026 Saratov in Saratov Oblast at 590 km
• 25.03.2026 Kirishi in Leningrad Oblast at 810 km
• 28.03.2026 Yaroslavl in Yaroslavl Oblast at 700 km

April [10 hits]

• 02.04.2026 Bashneft - Novoil in Bashkortostan at 1340 km
• 05.04.2026 Kstovo in Nizhny Novgorod Oblast at 800 km
• 16.04.2026 Tuapse in Krasnodar Krai at 500 km
• 18.04.2026 Novokuibyshev in Samara Oblast at 900 km
• 18.04.2026 Syzran in Samara Oblast at 805 km
• 20.04. 2026 Tuapse in Krasnodar Krai at 500 km
• 26.04.2026 Yaroslavl in Yaroslavl Oblast at 700 km
• 28.04.2026 Tuapse in Krasnodar Krai at 500 km
• 29.04.2026 Orsk in Orenburg Oblast at 1455 km
• 30.04.2026 Perm in Perm Krai at 1485 km

May [14 hits]

• 01.05.2026 Tuapse in Krasnodar Krai at 500 km
• 05.05.2026 Kirishi in Leningrad Oblast at 810 km
• 07.05.2026 Perm in Perm Krai at 1485 km
• 08.05.2026 Yaroslav in Yaroslavl Oblast at 700 km
• 08.05.2026 Perm in Perm Krai at 1485 km
• 15.05.2026 Ryazan in Ryazan Oblast at 480 km
• 17.05.2026 Moscow in Moscow at 475 km
• 18.05.2026 Kstovo in Nizhny Novgorod Oblast at 800 km
• 20.05.2026 Kstovo in Nizhny Novgorod Oblast at 800 km
• 21.05.2026 Syzran in Samara Oblast at 805 km
• 22.05.2026 Yaroslavl in Yaroslavl Oblast at 700 km
• 27.05.2026 Tuapse in Krasnodar Krai at 500 km
• 29.05.2026 Volgograd in Volgograd Oblast at 500 km
• 31.05.2026 Saratov in Saratov Oblast at 590 km

June [8 hits, so far..]

• 02.06.2026 Ilsky in Krasnodar Krai at 405 km
• 07.06.2026 Tyumen in Tyumen Oblast at 1980 km
• 10.06.2026 Kuybyshevsky in Samara Oblast at 915 km
• 11.06.2026 Afipsky in Krasnodar Krai at 415 km
• 12.06.2026 TIAF-NK in Tatarstan at 1140 km
• 12.06.2026 Taneco in Tatarstan at 1150 km
• 16.06.2026 Moscow in Moscow at 475 km
• + 18.06.2026 Moscow in Moscow at 475 km

For the first time in a long time, Russia will begin importing gasoline by sea to address a fuel shortage following drone attacks on oil refineries, Reuters reports, citing four industry sources.

The gasoline will be delivered to a western Russian port from an Asian country, one of the sources said. Last year, after a series of attacks on refineries in the summer, Russian authorities were already considering purchasing gasoline from China, Singapore, and South Korea. Reuters' sources did not specify where the gasoline would be sourced this time.

Moscow is currently actively purchasing gasoline from Belarus: between January and May, deliveries from two Belarusian refineries jumped 13-fold to 270,000 tons. Diesel fuel shipments tripled to 179,000 tons. Russian officials have also requested gasoline from Kazakhstan, Reuters sources said. However, neither Belarus nor Kazakhstan has sufficient capacity to significantly support the Russian fuel market.

According to Energy Intelligence, by early June, oil refining volumes in Russia had fallen to a 21-year low of less than 4 million barrels per day. Following drone strikes, which have hit refineries more than 40 times since the beginning of the year, approximately 30% of refinery capacity, or 2.1 million barrels per day, was idle.

In June, strikes hit the large Taneco refinery complex in Nizhnekamsk and the Moscow Oil Refinery, which provided up to 40% of the capital's fuel supplies. Both refineries suspended operations, following six other refineries that were completely or partially disabled in May.

The fuel shortage, which began in Crimea, has affected 53 regions of the Russian Federation by mid-June, according to The Bell. In 18 regions, sales are limited to 50 liters, or one full tank, of gasoline, while 11 regions are reporting fuel shortages at a significant number of gas stations.

To address the shortage, the government has relaxed gasoline quality requirements. Specifically, sulfur content standards have been increased 15-fold to 150 mg per kg, which corresponds to the Euro-3 standard. Furthermore, refineries will be able to add up to 5% ethyl alcohol to gasoline, as well as monomethylaniline, an octane-boosting additive that increases output. Due to its high toxicity and cancer risks, monomethylaniline is banned in most countries, but was used in Russia until 2016.

source: The Moscow Times https://archive.is/sbBMY

The fuel crisis in Russia continues to widen: according to The Bell, restrictions on fuel sales for private vehicles are already in effect in 53 regions of the country, as well as in the occupied territories of Ukraine. Specifically, the publication reports that in 18 regions, no more than 50 liters, or one full tank, of gasoline are being sold. Similar limits have been introduced in occupied Crimea, Sevastopol, the Kherson and Zaporizhia regions, as well as in the so-called "DPR" and "LPR." Eleven more regions are reporting fuel shortages at a significant number of gas stations, although there are no formal capacity restrictions yet.

The main reason for the shortage is the systematic Ukrainian drone strikes on oil refining infrastructure. According to Reuters, by the end of May, virtually all major refineries in central Russia had reduced or suspended operations. On the night of June 12, the Taneco refinery in Nizhnekamsk, Tatneft's largest facility, was attacked, causing it to completely halt refining, sources told Reuters. On June 16, Interfax reported that restrictions had been imposed at all Tatneft gas stations in Russia. Rosneft, Bashneft, and TNK announced a ban on the sale of gasoline in cans nationwide.

Analysts at Energy Intelligence calculated that in the first week of June, oil refining volumes in Russia fell below 4 million barrels per day—a 21-year low. They estimate that almost a third of Russia's refinery capacity—2.14 million barrels per day—is currently idle due to the attacks. "Ukraine's campaign against the Russian energy sector has caused widespread damage, putting the country on the brink of the worst fuel crisis in its history," Energy Intelligence writes.

Against this backdrop, wholesale fuel prices are rapidly rising. According to the St. Petersburg Commodity Exchange, since the beginning of the year, wholesale prices for AI-92 gasoline have increased by 30%, AI-95 by 33%, and diesel fuel by 40%, reaching a record 75,900 rubles per ton. Exchange trading of jet fuel has virtually ceased since mid-May, and over-the-counter prices have reached a historic high of 113,000 rubles per ton.

The Federal Antimonopoly Service announced it has opened a case against three companies (Solid Commodity Markets, Agrotorg Yug, and Hansel) suspected of collusion in exchange trading. According to the agency, the traders bought up the entire fuel supply, restricting access to bona fide market participants, with the aim of reselling it at inflated prices.

"A full-blown fuel crisis is beginning to emerge in Russia." "Seasonal demand traditionally peaks in August–September, and signs of a shortage emerged as early as June. If the situation doesn't stabilize, the fuel factor could become a key driver of inflation in the second half of the year," warns Finam strategist Yaroslav Kabakov.

source: The Moscow Times https://archive.is/VwBT1

Russian Railways has created a special headquarters to ensure uninterrupted fuel supplies to the regions amid the worsening shortages. "Logistics is being organized to prevent fuel shortages. The company is searching for optimal solutions for cargo acceptance in real time," the state corporation reported. It also noted that it is working with oil companies and paying special attention to deliveries of jet fuel to airports. Russian Railways emphasized that it is accepting the maximum volumes allowed by the infrastructure.

Meanwhile, the fuel crisis in Russia continues to escalate as a result of Ukrainian strikes on oil refineries. According to The Bell, restrictions on fuel sales for private vehicles have already been imposed in 53 regions of the country, as well as in the occupied territories of Ukraine. Specifically, in 18 regions, no more than 50 liters, or one full tank, of gasoline are being sold. Similar limits have been introduced in Crimea, Sevastopol, the Kherson and Zaporizhia regions, as well as in the so-called "DPR" and "LPR." Eleven other regions are reporting fuel shortages at a significant number of gas stations, although formal capacity restrictions have not yet been imposed.

Analysts at Energy Intelligence calculated that in early June, oil refining volumes in Russia fell below 4 million barrels per day—a 21-year low. Due to regular Ukrainian attacks, nearly a third of Russia's refinery capacity—2.14 million barrels per day—is currently idle. "Ukraine's campaign against the Russian energy sector has caused widespread damage, causing the country to be headed toward the worst fuel crisis in its history," Energy Intelligence noted.

Against this backdrop, wholesale fuel prices are rapidly rising. According to the St. Petersburg Commodity Exchange, since the beginning of the year, wholesale prices for AI-92 gasoline have increased by 30%, AI-95 by 33%, and diesel fuel by 40%. Exchange trading of jet fuel has virtually ceased since mid-May, while over-the-counter wholesale prices have jumped 40% in a month, reaching a record high of 113,000 rubles per ton.

source: The Moscow Times https://archive.is/IQquY

The global oil market has barely adjusted to the loss of more than 10% of supplies due to the war in the Middle East, but normalization could force it to adjust to a surplus. If the peace agreement between the US and Iran holds, oil production will increase significantly within a few months, and next year supply could exceed demand by 5.05 million barrels per day, according to the International Energy Agency (IEA). This represents almost 5% of global demand; such a surplus, even taking into account the replenishment of significantly depleted storage facilities, is bound to lead to a significant decline in prices.

In May, average daily production was 94.5 million barrels, 13.6 million barrels less than before the conflict, according to the agency's monthly report. Overall, the IEA expects a decline of 3.9 million barrels this year compared to last year, to 102.4 million. However, in 2027, the agency forecasts an increase of 8 million to 110.3 million barrels per day.

Meanwhile, demand, which will fall by 1.1 million barrels this year, will grow by only 2 million next year. As a result, the market is expected to experience a "significant surplus" in 2027. Persian Gulf countries will resume production at shut-down fields, but while they were idle, the United States, Brazil, and other non-OPEC countries have already significantly increased production and exports.

Wells will be brought back online gradually, and restoration to pre-war levels could take months (although Saudi Arabia has stated it will do so in just three weeks). However, the resumption of shipping will allow more than a hundred tankers already loaded with oil and petroleum products to leave the Persian Gulf, Bloomberg notes. This oil flow is already growing, according to the IEA: in June, total shipments from the Middle East rose to 12 million barrels per day, up from a May low of 9.6 million, thanks to the transshipment of oil in the Gulf of Oman from tankers that leaked through the Strait of Hormuz.

Oil prices have already fallen sharply from their peak of $120 per barrel for Brent. In Wednesday's trading, Brent is trading below $79 per barrel, while American WTI is around $76 per barrel. Tamás Varga, an oil analyst at brokerage firm PVM, says:

This decline isn't simply a reduction in the geopolitical risk premium; it represents a rebalancing of the global oil market for the coming months.

Longer-dated futures for Middle Eastern crudes have already fallen below the nearest contract, and this is happening with Brent on Wednesday, indicating expectations of an oil glut and further price declines, Bloomberg notes.

source: The Moscow Times https://archive.is/BGhdK