Is the drop in Russian oil prices linked to Ukrainian drone strikes?

November 17, 2025November 19, 2025

Bloomberg news agency, citing Argus data, published excellent news literally in the middle of the day. However, they made somewhat questionable conclusions about the causes behind the drop in Russian oil prices. They reported that the price of Urals — the main export brand of Russian oil producers — fell to $36.61 per barrel at the end of last week during shipment from Novorossiysk port. Indeed, the Urals discount to North Sea Brent crude quotations reached $23.51 per barrel. This is a record value since March 2023.

Why Today’s Discount Is Worse Than 2023

But we consider a direct comparison with the situation two years ago incomplete. Compared to 2023, today’s discount turned out to be significantly larger — but today’s oil price is also significantly lower. Both these factors affect the profit that Russians receive or don’t receive much more substantially. And so, according to Bloomberg, the record discount occurred on the eve of US sanctions taking effect on extraction companies of the orcs “Rosneft” and “Lukoil”.

In reality, not only US sanctions are at play here. More importantly, sanctions by the Armed Forces of Ukraine matter even more. The thing is, during regular missile and drone strikes on enemy refineries, the situation became critical. Especially strikes on the loading part of Novorossiysk port created chaos.

To put it simply, the Orcs are now literally choking on oil. They have nowhere to put it. Enemy press writes the following about this:

Five of India’s largest refineries, which purchased about 1 million barrels per day from Russia — Reliance Industries, Bharat Petroleum, Hindustan Petroleum, Mangalore Refinery and Petrochemicals, and HPCL-Mittal Energy — have already refused shipments arriving after sanctions finally take effect. China’s state-owned companies — Sinopec and PetroChina, as well as small private refineries — have also announced a “boycott” of direct purchases from Lukoil and Rosneft…

As a result, oil producers are accumulating unsold volumes that remain on tankers converted into floating storage. According to JPMorgan estimates, about a third of Russia’s oil exports — or 1.4 million barrels per day — are “stuck” at sea.

Orcs Drowning in Their Own Crude

Western observers see only part of the picture, namely — cluttered tankers at sea.

But they don’t see what’s happening inside the federation itself. And today the orcs simply have no choice, and they’re selling oil not with some specific discount but “for whatever they’ll take”. Because otherwise oil wells will have to be mothballed, and restarting a mothballed well in Siberia is very different from, say, in the UAE. The entire extraction arm of the Russian oil industry will start collapsing.

Previously, such a possibility was considered only as theory, but now it has materialized in full — hence such gigantic “discounts”. Obviously, some dealers simply won’t be able to resist such discounts, and the orcs need to dump all this somewhere. But at such price levels, the orcs are already left without planned profit, and possibly are already shipping oil at a loss.

But there’s nowhere to go, since accumulation of oil in coastal storage will inevitably lead to strikes on them by the Armed Forces of Ukraine. Therefore, they must export anywhere and on any terms. Yet considering that our military demonstrated real inclusion of the Novorossiysk terminal in the target bank, everything must be done urgently. The drop in Russian oil prices isn’t only market forces — it’s also Ukrainian drones forcing Moscow to sell at fire-sale prices or drown in crude.