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Russian government halts diesel exports and slashes tariffs to counter severe seasonal fuel deficit

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Russian Deputy Prime Minister Alexander Novak reported to President Vladimir Putin during a meeting with government members that while the cabinet has partially stabilized the domestic fuel market, altered logistics caused by refinery attacks and a sharp spike in seasonal demand continue to strain the sector.

Novak stated that attacks on Russia’s fuel and energy infrastructure damaged several oil refineries, leading to a temporary decline in gasoline and diesel production.

The drop in output has necessitated new shipment routes to deliver fuel to end-users, Novak said, adding that current demand is approximately one-third higher than during the same period last year.

The deputy prime minister noted that this situation has increased the burden on filling stations, raising the number of vehicles visiting the stations and leading to longer refueling times.

To balance the market, Novak recalled that the government and oil companies had previously taken a series of steps. Within this scope, gasoline exports were completely banned, and the production capacities of small and medium-sized refineries were utilized. Oil companies also maximized the capacity utilization of operating refineries, shortened maintenance periods, postponed planned maintenance to later dates, and released previously accumulated fuel inventories to the domestic market.

Government also halts diesel exports

Novak announced that the government banned diesel exports on July 8 as an additional measure.

Stating that oil product imports will be increased in July and the production of fuel with lower environmental standards will be expanded, Novak noted that the zero tariff on oil product imports was extended for another year to support imports.

Furthermore, Novak stated that the government reached an agreement with Russian Railways (RJD) to apply discounts on the rail transport of imported fuel. He also recalled that the mandatory exchange sale quota for gasoline was reduced from 15% to 10% and a price ceiling was imposed on the commodity exchange.

To secure the volume of fuel required by independent filling stations, Novak said that these operators have transitioned to direct contracts with oil companies, noting that this practice has been implemented in the Irkutsk Region and the Zabaykal Krai.

According to the information provided by Novak, independent filling stations previously purchased the bulk of their fuel from the commodity exchange or intermediary companies. Out of approximately 29,000 filling stations in Russia, 20,000 belong to independent operators.

Putin backs small refinery proposal

Zabaykal Krai Governor Alexander Osipov, who attended the meeting, proposed the establishment of a network of small-scale oil refineries across Russia.

Putin supported this proposal, stating, “In this area, the participation of small and medium-sized enterprises in the process is also necessary and encouraged. We will work more intensively on this matter.”

The Russian president also said that vertically integrated oil companies must supply products not only to their own stations but also to independent filling stations.

Putin instructed the government to make decisions regarding the subsidization of fuel prices in Crimea and Sevastopol “as quickly as possible.”

According to July 6 data from the Russian Federal State Statistics Service, the price of a liter of AI-92 gasoline in Crimea rose to 123.53 rubles. This figure represents an increase of approximately 50% on a weekly basis. The price of a liter of AI-95 gasoline rose to 170.59 rubles, increasing approximately 1.9 times, while the price of a liter of diesel reached 139.15 rubles, rising approximately 1.6 times.

In Sevastopol, the price of a liter of AI-92 gasoline rose by 8% to 105.47 rubles, the price of a liter of AI-95 gasoline increased by 15% to 148.64 rubles, and the price of a liter of diesel rose by 8.5% to 150.49 rubles.

Across Russia, in the week of June 30 to July 6, the price of a liter of AI-92 gasoline increased by 2% to 70.21 rubles, and the price of a liter of AI-95 gasoline rose by 2% to 76.19 rubles. The price of a liter of diesel reached 87.76 rubles, representing a 3% increase.

Since the beginning of the year, gasoline prices in the country have risen by 14%, while diesel prices have increased by 15%.

At the end of June, local governments in various regions of Russia introduced different restrictions on fuel sales to prevent panic buying.

Putin said on June 28 that there was a fuel deficit in the domestic market, but it was not at a critical level. Holding a meeting on the oil products market on the same day, Putin requested the preparation of additional measures to guarantee the uninterrupted supply of fuel to citizens, businesses, and socially critical institutions.

According to Sergey Tereshkin, General Director of Open Oil Market, the main reason for the spike in fuel demand is concern over potential supply shortages. Tereshkin said that consumers have increased both retail and wholesale purchases out of concern that access to fuel may become more difficult in the coming weeks and months.

Dmitry Kasatkin, Partner at Kasatkin Consulting, stated that the fuel shortage stems from a combination of altered logistics, local supply disruptions, and panic buying driven by high seasonal demand. He noted that demand for gasoline and diesel has increased not only in the retail market but also in the small and medium wholesale market.

According to Kasatkin, banning exports, postponing refinery maintenance, operating existing facilities at higher capacity, and releasing inventories into the market are among the most effective measures to increase domestic supply. However, he emphasized that delivering fuel to regions where the shortage is felt most acutely is also of critical importance.

Kasatkin said that increasing gasoline imports, RJD transport discounts, and production increases at small and medium-sized refineries are also important supporting steps, but their success will remain dependent on resolving logistics issues.

Tereshkin argued that the most critical steps are halting oil product exports and increasing fuel imports. Igor Yushkov from the Financial University under the Government of the Russian Federation assessed that increasing gasoline imports and the production of fuel with lower environmental standards would be the most effective measures.

Mikhail Burmistrov, General Director of Infoline-Analitika, said that RJD can apply discounts on certain routes, which will encourage the transport of additional cargo on the railway network.

However, Burmistrov stated that due to the limited capacity of unloading and loading terminals on the railways, the volume of these shipments should not be overstated, adding that the bulk of imported fuel will be transported by road.

Kasatkin predicts that partial stability could be achieved in the Russian fuel market during July. However, in his view, establishing a permanent balance between supply and demand, easing panic buying, and rebuilding inventories may take until late August or early September. He warned that local fuel shortages could occur in some regions until that date.

According to the analyst, if the measures taken by the government prove effective, price increases at filling stations may slow down in the coming weeks. Conversely, even if the market stabilizes, fuel prices are not expected to return to their former levels.

Russia

Valdai Forum debates superpower survival amid global anarchy

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The survival strategies of superpowers were addressed at a meeting of the Valdai Discussion Club held in Russia.

Speaking at a session titled “Geopolitical Re-division: Power as a Guarantee of Peace or a Pledge of War”, John Mearsheimer, Professor of Political Science at the University of Chicago, argued that the best way for superpowers such as Russia, China, and the US to sustain their existence under conditions of international anarchy is to increase their military and economic power.

During the session, Mearsheimer drew attention to the fact that the fundamental priority for every state is survival.

Stating that there is no higher authority in the international system, Mearsheimer made the following assessment:

“Every state wants to survive, because survival is the number one goal. Let me conclude by returning to my main point: never forget that you operate under conditions of international anarchy, meaning there is no ultimate authority. The moment you recognise this reality, you realise that the best way to survive is to maximise your relative power. The concept of relative power is synonymous with the balance of power. If there is a great power in the system, the balance of power assumes immense importance; because power is the key to survival.”

Expressing that only three true great powers exist in the world, Mearsheimer listed these countries as the US, China, and Russia.

Stating that India is not included in this category because it lacks sufficient economic wealth despite its massive population, the professor noted that a large population and substantial economic resources form the foundation of military power.

Stating that the competition between the US and China continues not only in the military sphere but also in the field of technology, Mearsheimer emphasized that the race in artificial intelligence and other advanced technologies determines both wealth and military capacity in today’s world.

Dmitriy Trenin, Research Supervisor at the Institute of World Military Economics and Strategy at the Higher School of Economics (HSE) and President of the Russian International Affairs Council (RIAC), also stated during the discussion that Russia must preserve its great power identity, otherwise it will not be able to survive.

Pointing to the question of whether the US can maintain its global leadership, Trenin said that the future of all humanity could depend on this balance.

Expressing that the concepts of power and survival carry a distinctive relationship, Trenin conveyed that theories in Western political science do not fully align with the reality in Russia. Touching upon his country’s past, Trenin said, “Russia faced an existential survival risk twice in less than 100 years. The state collapsed first in 1917, and then in 1991. There is no guarantee that it will not collapse once more.”

Trenin recalled that although the Soviet military was at the peak of its power in 1991, this military might failed to save the USSR from dissolving.

Emphasizing that might does not consist solely of military force, Trenin brought up lines by the poet Aleksandr Pushkin depicting the struggle between gold and steel.

Trenin also cited the saying, “A donkey laden with gold can conquer any fortress.” The Russian analyst concluded that the country’s survival depends on Russia’s own internal dynamics and domestic condition, rather than on relations established with other states.

Alastair Crooke, a British diplomat and founding director of the non-governmental organisation Conflicts Forum, argued at the session that military force constitutes only one dimension of influence.

Citing the Palestinians as an example, Crooke expressed that the people sacrifice their lives for the sake of their own civilisational idea, way of life, and worldview.

The diplomat stated that even without substantial military power, Palestinians rally support in their struggles for sovereignty by relying on different elements of power, rather than merely on the number of tanks, money, or fighter jets.

Stating that a system of a “concert of powers” reflecting a compromise between civilisations could emerge in the future, Crooke expressed that in this order, states would preserve their sovereignty and would not abandon their own native civilisations.

The British diplomat said that old international structures, including the existing United Nations mechanism, must definitely be transformed.

Earlier, an analysis in Politico reported that US President Donald Trump sought to develop relations with Russia in order to prevent the construction of a Beijing-led global order.

Trump, for his part, expressed that Washington and Beijing could achieve great things together, and described President Xi Jinping as a “great leader” following his official visit to China.

Zheng Yongnian, Dean of the School of Public Policy at the Chinese University of Hong Kong, emphasized that despite its relative decline, the US maintains its global hegemony, and that underestimating Washington would produce a fatal mistake.

US Secretary of State Marco Rubio also characterised China as the greatest geopolitical challenge for his country, but noted that relations with Beijing constitute one of the most critical portfolios for Washington.

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Mearsheimer says Trump seeks Ukraine peace but lacks diplomacy skills

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Simultaneously with contacts conducted by US President Donald Trump’s representatives Steven Witkoff and Jared Kushner, a delegation of prominent American political scientists visited Moscow.

Professor John Mearsheimer, a faculty member at the University of Chicago who took part in the delegation, answered questions from the Russian daily Kommersant on the sidelines of a round-table meeting jointly organised by the Russian Council on Foreign and Defence Policy and the Higher School of Economics.

Mearsheimer said that while the Washington administration possesses the potential to play a constructive role in ending the war in Ukraine, it has not yet translated this capacity into action.

Stating that an American effort to encourage the Kyiv administration to reach a compromise with Russia and halt the war would make a positive contribution, the political scientist said: “Having potential is one thing, realising it is another matter. In this sense, the US has not yet used its potential and has not taken noteworthy steps that would contribute to ending the war in Ukraine.”

Evaluating Trump’s dispatch of negotiators Witkoff and Kushner to Moscow and Kyiv over the weekend, Mearsheimer emphasised that the American president is maintaining his efforts.

Recalling that the representatives had previously travelled to the Russian capital, the professor offered the following assessment:

“Trump is striving to achieve progress. The fact that he sent Witkoff and Kushner back to both capitals, despite having failed in the past, shows that he has not abandoned this objective. Yet at this stage, I see no concrete reason to believe these initiatives will succeed. There is no ground to think that Witkoff and Kushner have developed a magic formula that will end the war in Ukraine.”

Mearsheimer also addressed the motivation underlying Trump’s desire to end the conflict. Stating that the US president definitely wants to stop the war, the political scientist noted that Trump wants to be recognised as a peacemaker and receive the Nobel Peace Prize.

Arguing that Trump, who regards ending the war as serving American interests, is inexperienced in diplomacy, Mearsheimer remarked: “He does not know how to resolve this extremely complex problem. When his novice diplomacy combines with an issue of such intricacy, it is not surprising that he cannot make progress.”

Stating that although Trump previously described the conflict frequently as “Biden’s war”, the present picture shares out responsibility, Mearsheimer said that the conflict has now become Trump’s war.

Pointing out that the US administration continues weapons supplies via Europe, intelligence sharing including for strikes targeting Russian territory, and satellite internet support, the political scientist said:

“Before Trump returned to the White House in January 2025, this was Biden’s war. But when he became US president and could not end the war, this conflict turned into his own war. It is clear that the US continues its support by providing direct intelligence and indirectly giving the Europeans weapons to be transferred to Ukraine. Therefore, the US, and President Trump in particular, continue to provide support to Ukraine and contribute to the continuation of the war.”

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Russia aids Iran in covert supersonic cruise missile project, FT says

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According to a report by the Financial Times (FT), Russia is assisting Iran in developing advanced supersonic cruise missiles through a covert programme.

The multi-year secret collaboration, described as one of the most comprehensive strategic military technology transfers between Moscow and Tehran, reportedly bears the codename “C430L”.

Based on an examination of leaked correspondence, travel records, and military patents, the report stated that the programme, which began in 2023, continued during the war waged against Iran by the US and Israel.

Under the programme, experienced Russian missile specialists were reported to have supported Iran in developing a new class of weapons capable of threatening US aircraft carriers and warships in the Middle East.

Ramjet technology aimed at breaching air defence systems

According to the report, the primary objective of the C430L programme is to assist Iran in developing a ramjet propulsion system that enables a cruise missile to fly at several times the speed of sound.

Military experts point out that the technology in question is designed for use in anti-ship and land-attack cruise missiles.

Fabian Hinz, an expert at the UK-based arms monitoring group Conflict Armament Research, emphasised that this strategic transfer, which the Iranians have sought to obtain for decades, would require approval at the highest political level in Russia.

Jim Lamson, an expert at the James Martin Center for Nonproliferation Studies and a former CIA analyst, stated that this system would provide Iran with a new strategic weapon capable of threatening US naval assets.

Supersonic cruise missiles combine high speed with low-altitude flight capabilities, narrowing the time available for advanced air defence systems to detect and intercept the missile. This represents a strategic advantage for the Tehran government along the Persian Gulf line, where the US and its regional allies possess land- and sea-based defence systems.

The report noted that while Iran had built the ramjet system and conducted flight tests, there was no concrete evidence that a Russian-backed supersonic missile had yet been deployed in the field.

State enterprises and chief engineers involved

The supersonic missile assistance programme is reportedly coordinated by Russia’s state-owned arms export company Rosoboronexport, with the project being executed alongside NPO Mashinostroyenia.

NPO Mashinostroyenia, which was placed on the US sanctions list in 2014, is known for its work on cruise missile systems launched from ships, submarines, and land platforms, as well as Russia’s nuclear forces comprising intercontinental ballistic missiles.

Leaked travel records show that senior Russian engineers and export officials travelled to Iran multiple times before a contract was signed with Iran’s Ministry of Defence and Armed Forces Logistics in November 2023.

These figures include Aleksandr Dergachev, chief designer of naval missiles at NPO Mashinostroyenia; Aleksander Chebakov, a ramjet specialist; Yuri Prokhorchuk, head of the aerodynamics department; and Vladislav Kuzmichev, head of the Defence Technologies and Space Department at Rosoboronexport.

The documents indicate that by 2025, the company had received extensive Iranian technical materials regarding the ramjet propulsion system, analysed telemetry data obtained from a flight test, and submitted detailed queries to Tehran on topics including the fuel system, combustion stability, and the air intake.

In April 2025, Rosoboronexport proposed sending a delegation of around twenty experts to Iran for technical consultations.

Military cooperation between the two countries deepens

The programme is regarded as part of a deepening military partnership between Tehran and Moscow. Iran had previously supplied Shahed-type armed unmanned aerial vehicles used by Russia in the Ukraine war and assisted in their production within Russia.

Western officials also accuse Russia of providing satellite imagery and weapon components to Iran during the ongoing hostilities with the US and Israel.

The report recalled that Russian President Vladimir Putin, during his meeting with Iranian President Masoud Pezeshkian in Kyrgyzstan, said Moscow was “striving to provide the necessary aid and goods in this difficult period”.

Nicole Grajewski of Sciences Po University in Paris stated that the covert ramjet programme demonstrated “Russia’s effort to widen the war in Ukraine and draw the US to different fronts”, noting that Moscow no longer attached as much importance to regional red lines as it once did.

Leaked correspondence reveals that the C430L programme continued into 2026, with the parties continuing to negotiate technical reports and the next phase of the development process.

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