Reuters: Russia Admits Its Oil Strategy Has Failed

The Kremlin has sharply lowered its oil production forecast.

The Russian government has sharply revised downward its oil production forecast amid the fallout from the war against Ukraine. According to the draft government forecast, oil and gas condensate production in 2026 will total 494.2 million metric tons—the lowest figure since 2009, reports Reuters.

The new estimates are 16–20 million metric tons lower than the May forecast for the 2026–2029 period. The revision is due, among other things, to the fallout from the war, the European embargo, problems with export infrastructure, and attacks by Ukrainian drones on Russian oil refineries.

The attacks on oil refineries have led to a reduction in fuel production and caused gasoline shortages within Russia. Against this backdrop, the authorities continue to redirect oil exports toward China and India.

“Oil production remains under pressure due to the consequences of the war and export problems,” the publication notes.

According to the baseline scenario, production will partially recover to 500 million metric tons in 2027 and reach 505 million metric tons in 2028–2029. However, even these figures will remain below the 2025 level, when Russia produced 511.4 million metric tons of oil and condensate.

At the same time, crude oil exports could rise to 244.7 million metric tons in 2026. This is primarily due to a decline in domestic refining volumes. In subsequent years, exports will continue to decline—to 232.5 million metric tons in 2027 and 216.6 million metric tons in 2028–2029.

Exports of petroleum products also remain under pressure. In 2026, they could fall to 98.5 million metric tons due to a ban on diesel fuel exports and restrictions on gasoline and jet fuel exports.

“The Russian oil industry continues to suffer from the serious consequences of the war,” writes Reuters.

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