Russian Crude Oil Production Hits One-Year Low in May Amid Ukrainian Drone Strikes

Russia's crude oil production in May fell to 9.009 million barrels per day, its lowest level in a year, largely due to Ukraine's drone campaign against oil infrastructure. This decline, ongoing for six months, impacts the mineral extraction tax, a primary source of federal budget revenue for financing the war. Daily output has shrunk by approximately 370,000 barrels since its November peak of 9.38 million barrels, and the May figure is 690,000 barrels per day below Russia's OPEC+ quota.

Ukrainian strikes have damaged oil storage and transportation capacity, reducing crude extraction. In May, Ukraine conducted at least 31 strikes on Russian refineries, seaborne export terminals, and pipelines, the highest monthly count since the full-scale invasion. These attacks caused Russian refining to collapse to 2009 levels in May, and refining runs have since fallen to a two-decade low.

Despite falling production, seaborne crude exports increased, averaging 3.64 million barrels per day over the four weeks ending May 31, up from 3.17 million barrels daily in the four weeks to April 17. This export shift allows companies to increase income, but the federal budget, reliant on the mineral extraction tax, suffers directly from reduced production.