Russia’s war budget got a brief respite this spring, when the Iran war pushed oil prices up. By July, it was gone. A single month swung from a rare surplus to an $8.8 billion deficit, leaving the seven-month shortfall already bigger than the entire deficit Russia ran last year, with five months still to run.

As oil money drains away, the Kremlin is covering the gap by taxing ordinary Russians harder and eyeing their savings.

Oil-and-gas income, long the war’s financial engine, fell by about a sixth from a year earlier to 4.6 trillion rubles ($56 billion), Finance Ministry figures show. Spending outpaced revenue, with state procurement up by nearly two-fifths.

The hole was plugged by value-added tax, whose receipts jumped by a quarter after Moscow raised the rate to 22% at the start of the year—a tax levied on ordinary Russians’ spending, not on oil prices or economic growth.

One month of relief, then the gap reopened

The reprieve proved brief. July’s deficit followed June’s surplus even though spring’s higher oil prices should have cushioned the books, Bloomberg calculations showed.

Much of the windfall never reached the budget: it went to subsidizing oil firms whose refineries Ukrainian drones keep hitting, Gaidar Institute economist Ilya Sokolov wrote in a July monitoring paper.

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With the economy barely growing in the first half, a second-half recession could knock out another chunk of tax revenue just as the shortfall widens. Yaroslav Kabakov of the Finam brokerage expects the full-year deficit to approach double last year’s by year-end. Even as revenue shrinks, the military reportedly wants roughly 40% more than planned.

Borrowing, the other fallback, is jamming too. Russia suspended government bond auctions in July after investors balked and it could no longer raise money cheaply at home, even as Finance Minister Anton Siluanov vowed to shield defense and social spending.

Moscow shifts the burden to households

The burden is shifting onto households. The VAT rise alone will raise about $13 billion a year—barely a month of military spending—yet, unlike seizures aimed at billionaires, it reaches nearly every Russian, columnist Agathe Demarais wrote in Foreign Policy.

A draft law would allow the state to move around $40 billion from private pension accounts, and Communist leader Gennady Zyuganov has urged Vladimir Putin to tap the savings Russians hold in banks. Moscow will not run out of cash soon, Demarais argued, but it is “running out of politically affordable ways to raise it.”

Ordinary Russians are already moving their money. Through the first half of 2026, they withdrew cash from the banking system at the fastest pace since the pandemic, and the Central Bank has begun allowing banks to flag and freeze “suspicious” withdrawals, Euromaidan Press reported.

Ukraine’s sustained drone strikes on Russian refineries have reversed the country’s position as a net fuel exporter. Moscow now imports gasoline from as far as India and Morocco while rushing crude oil through the Arctic to reach Asian buyers it can no longer supply with finished fuel. The flows are scaling up—and running on the same sanctioned, EU-listed tankers.

The reversal is tightening global fuel markets. Russia runs the world’s third-largest refining industry, and the combined disruptions have acted to squeeze supply worldwide, with Moscow banning exports of both gasoline and diesel to keep its own pumps supplied.

Russian refining falls to its lowest since 2002

Ukrainian drone strikes have driven Russian crude processing to 3.6 million barrels a day in July—its lowest level since 2002 and roughly a third below the seasonal norm, according to EA Analytics data cited by Bloomberg.

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Ukraine hit at least 24 of Russia’s 34 largest refineries in some 50 strikes, with five more struck last week and at least two this week. With refining at a 24-year low, Russia is exporting crude through the Arctic while importing refined fuel from India.

Fuel shortages and rationing now affect about 50 million people—a third of Russia’s population. Moscow is subsidizing both the damaged refineries and the imported fuel replacing their output.

Sanctioned tankers take crude toward the North Pole

Seven tankers carrying about six million barrels of crude were heading to Asia through the Northern Sea Route as of 11 August. That volume already amounts to nearly half the approximately 13 million barrels the route carried during the entire 2025 season.

The route cuts two weeks off the voyage to China compared with the Suez Canal, and ice conditions are relatively mild this year, one trader told Reuters.

But speed is only part of the surge. Tankers on the Arctic route bypass European waters, where enforcement has led to inspections and detentions of sanctioned vessels, and Ukraine’s strikes on Black Sea shipping and the Iran–US standoff at Hormuz have narrowed the alternatives.

Vessel-tracking data show the convoy following a route north of the Severnaya Zemlya archipelago rather than through the traditional and more southern Vilkitsky Strait—putting sanctioned oil tankers within 500 nautical miles of the North Pole. Maritime experts said commercial traffic at this scale has never operated that far north.

Russian crude returns home as Indian gasoline

In the opposite direction, gasoline refined from Russian crude at Nayara Energy’s Vadinar refinery in western India is flowing back to Russia through a chain of ship-to-ship handoffs at Egypt’s Damietta Port. At least three cargoes have cycled through the hub since June. The first reached Russia on 5 August.

Bloomberg’s tracking data show the tanker Cyclone loaded 42,000 tons of gasoline at Vadinar on 18 June, transferred the cargo to the Oman-flagged Garnet off Damietta on 6 July, and the Garnet reached Russia in early August. Two more tankers, Varg and Photon, followed the same route in July, with Photon’s cargo handed to the Russian-flagged Talisman on 28–29 July.

All these vessels are under EU sanctions. Garnet and Talisman are also under US sanctions.

Nayara’s refinery, which processes 400,000 barrels a day, is 49% owned by Rosneft. EU sanctions in July 2025 drove away its non-Russian crude suppliers, so the plant switched to processing only Russian oil and now buys and sells through traders—which is how its gasoline reaches Russia without a direct India-to-Russia sale, as Euromaidan Press reported.

The expected September launch of Rosneft’s Vostok Oil project could push more crude through the Northern Sea Route, traders told Reuters. NSR crude shipments fell 4% in 2025. This year’s opening weeks have already matched half the full-season total.

A Ukrainian drone strike shut the plant that produces 40% of Russia’s liquefied petroleum gas on 10 August, and the country’s fuel crisis snapped back across at least 16 regions within days.

The shutdown of the Sibur ZapSibNefteKhim complex in Tobolsk, western Siberia, removes about six million metric tons of annual LPG capacity from a fuel system that was already under strain.

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Gasoline restrictions had begun easing across Russia at the end of July, when Ukrainian drones temporarily shifted to other targets. When the strikes resumed in early August, fuel rationing returned immediately, the independent Russian outlet 7×7 reported.

Three industry sources told Reuters on Tuesday that the complex stopped operations indefinitely “while the extent of the damage and its consequences are being assessed.”

No LPG volumes were offered from the Tobolsk delivery point on Russia’s commodity exchange—a point that earlier this year handled about 4,000 metric tons of propane-butane mix per day. Sibur declined to comment.

A strike on one unit stopped the entire plant

Tyumen Oblast Governor Aleksandr Moor confirmed a fire at an industrial site following a drone attack but did not identify the facility.

Ukraine’s Special Operations Forces Deep Strike units, working with the Russian insurgent movement Chornaya Iskra (Black Spark), claimed the strike. The plant sits more than 2,200 kilometers from the front line.

Militarnyi’s OSINT analysis identified the specific target as the complex’s central gas fractionation unit—the plant’s entry point, where raw hydrocarbons are separated into usable products before anything else in the production chain can run. About half of ZapSibNefteKhim’s output feeds Sibur’s own petrochemical complex in Tobolsk; the rest goes to market.

Sibur held contracts to supply feedstock to defense-industry enterprises, including the Kamenskiy Kombinat, which produces solid rocket fuel and motors for the Grad, Smerch, and Uragan rocket systems.

Sibur also supplied the Perm Gunpowder Plant, which makes charges for multiple-launch rocket systems, air-defense complexes, and cruise missile boosters, Militarnyi also reported. The Sverdlov Plant and Biysk Oleum Plant, both explosives manufacturers, were also Sibur clients.

Fuel rationing returned within days

Across at least 16 regions, the fuel restrictions that had briefly eased in July are back, 7×7 reported.

In Sochi—Russia’s most famous beach resort—Mayor Andrei Proshunin said on Telegram that fuel was available at only 38 of the city’s 58 gas stations. Deputy Mayor Vyacheslav Bauer told residents and tourists to use public transport or stop driving, the Moscow Times reported.

In Bashkortostan, authorities banned gasoline sales in canisters, leaving at least one resident unable to fuel his lawnmower—as he complained to regional head Radiy Khabirov during a televised address, a Bashkortostan outlet reported. Production at the Ufa petrochemical complex is unaffected by the drone strikes, Khabirov said.

Still, the shortage persists for a different reason: every time a drone-alert protocol is activated, fuel tankers halt en route to gas stations, regional official Elena Prochakovsky explained at a briefing reported by Prufy. Three districts remain in a fuel “red zone,” and 19 of 26 gas stations in Sterlitamak are operating.

Lipetsk Oblast Governor Igor Artamonov told residents not to expect improvement for one to two weeks, Lipetsk outlet Ploshchad reported. “If you can leave 10 liters unfilled, the person arriving on empty will thank you,” he said.

Russia’s fuel system was already breaking

The Tobolsk shutdown lands on an already fractured system. By mid-July, fuel rationing had spread to more than half of Russia’s regions. Ukraine’s drone campaign had struck Russian refineries 194 times in the first half of 2026 alone—eleven times the previous year’s pace—knocking nearly half the country’s refining capacity offline, Ukraine’s General Staff reported on 4 July.

Repair timelines keep slipping because sanctions block the spare parts Russian plants need. To plug the gap, Russia has banned gasoline exports, permitted lower-grade fuel, and begun importing gasoline from India and Morocco, refined from its own crude—shipping it 14,000 kilometers home because its refineries cannot meet domestic demand.

The Tobolsk shutdown removes more LPG output than any single strike of the war. Russia was already rationing fuel in more than half its regions before this strike.

When Sweden’s Anton Källberg walks into the arena on Tuesday to face Vladimir Sidorenko at Europe Smash, the match carries a weight that reaches beyond the table.

Sidorenko is Russian, and unlike the Russian players who spent recent years competing as neutrals, he now takes the table representing Russia, under its flag and anthem.

The change follows a July decision by the International Table Tennis Federation (ITTF) to lift the restrictions on athletes holding Russian passports. It took effect on 28 July, and Russian players can now enter under the same ordinary rules as everyone else.

For critics, the question is hard to avoid: what has changed in Ukraine to justify the change in sport?

What changed in Ukraine? Nothing

Russia’s full-scale invasion has not ended. Yet the penalty imposed in its wake—that Russian athletes compete without representing the Russian state—has now been lifted in international table tennis.

The Swedish Table Tennis Association has openly opposed the move. Its chairman, Tomas Eriksson, said in July that he saw no change in Ukraine that would justify shifting Swedish sport’s position toward Russian participation. The association has said it will not boycott the tournaments.

That tension now lands on Swedish soil.

Källberg and Sidorenko were drawn against each other at Europe Smash, held in Malmö from 8 to 16 August.

For Swedish supporters of Ukraine, the evening presents a real dilemma. Nobody needs to aim hostility at Sidorenko himself, and no one is claiming individual Russian athletes bear responsibility for their government’s actions. The question is what an athlete is asked to represent.

A flag is never neutral

A neutral athlete competes as an individual. Someone introduced beneath a national flag stands in, however indirectly, for a state. Flags and anthems are written into international sport precisely because they carry national and political meaning.

So restoring the Russian flag is more than an administrative tweak. It is a statement—and a pointed one while Russia’s war on Ukraine continues.

The dispute has an unmistakable Swedish dimension. ITTF is headed by Petra Sörling, the Swedish official who was re-elected president of world table tennis in 2025 for another four-year term. She is a former president of the Swedish Table Tennis Association.

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That does not make the reinstatement hers alone to decide; the ITTF Executive Board considered the issue on 10 July. But leadership carries responsibility. ITTF has justified the change by citing equal treatment and proportionality—yet proportionate to what change in circumstances? With Russia’s war on Ukraine still ongoing, the federation has yet to explain what has materially shifted to make the earlier restrictions disproportionate now.

On the evening of 11 August 2026, all of it narrows to something plainer: two players and a table, in front of a Swedish crowd.

Källberg deserves what any Swedish athlete would want at a major home tournament: loud, passionate backing from the crowd. And those who object to the return of the Russian flag have every right to voice it, peacefully, from the same seats.

Symbols cut both ways

Sport does not stand outside the world around it. International federations prove as much every time they raise a flag or set a country’s name beside an athlete.

If those symbols matter when a nation celebrates victory, they matter when a governing body decides who may use them.

And until the reasons for restricting Russia’s national representation have gone, the question facing table tennis stays simple: Why should the restriction disappear first?

Jakob Gottlieb

Jakob Gottlieb is a Swedish tech entrepreneur and volunteer.

Editor's note. The opinions expressed in our Opinion section belong to their authors. Euromaidan Press' editorial team may or may not share them.

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Russia can’t refine its way out of its fuel crisis, so it is changing who controls the already existing fuel. Months of Ukrainian drone strikes on refineries have driven shortages and rationing across much of the country. The government’s answer isn’t more fuel—it is a different market.

Faced with the shortage, the Kremlin had options. In June, analysts urged it to raise the exchange quota to push more fuel onto the open market and toward the regions running dry.

It did the opposite. The mandatory share of gasoline that producers must sell on the open exchange was cut from 15% to 10%, with the majors pushing for 2%, and the exchange was closed to anyone but buyers who will use the fuel themselves, shutting out traders who bought to resell.

That choice adds no fuel. It moves distribution off the exchange that set prices for a decade and into direct contracts between the big producers and the buyers they pick—handing the majors the chain from refinery to pump. Part of the package came straight from proposals Rosneft head Igor Sechin sent to President Vladimir Putin.

Winners and losers

The winners are the big, vertically integrated oil companies, which refine up to three-quarters of Russia’s oil. Direct deals let them keep the margin that once went to middlemen and choose who gets supplied; drop the quota to 2%, and about 5 million tonnes of gasoline a year move into their private channels.

The losers are the independent stations—60% to 72% of Russia’s roughly 25,000 gas stations, depending on who’s counting, and now unable to buy at the exchange price.

Alexander Moiseev, who owns the Kostroma Fuel Company, has been hauling gasoline from Surgut, 2,000 kilometers away, at 118 rubles a liter ($1.45) with freight, because the majors won’t sell to him wholesale. He works on a minimal markup. Rosneft, meanwhile, has multiplied sales at its own pumps.

What stabilization there is has been narrow. Prices eased mainly where supply was steered—Moscow, St. Petersburg, the big cities—while regions thick with independent gas stations stayed short, independent analyst Kirill Rodionov told Kommersant.

None of this is hidden. Facing the crunch, the government also let refiners sell banned Euro-2 gasoline again; online marketplaces pulled fuel listings; and Deputy Prime Minister Alexander Novak called the market “challenging but under control.”

In occupied Crimea it goes furthest: this week, the occupation authorities announced fuel sales were stabilizing, even as they capped each car at 20 liters and fixed the price of AI-92, the Crimean Tatar Resource Center reported.

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The market goes dark

As the exchange shrinks, its prices no longer reflect the market, and the state publishes less information on output, stocks, and regional supply. The people who most need to see where Russia’s fuel balance is breaking—regulators at home, and the sanctions monitors and energy analysts abroad who read that data—are left with less to look at, market participants told Kommersant. The market is going dark.

Whether the change sticks is contested. Some read the cuts as a passing emergency. Others expect the market to keep sliding toward closed, bilateral deals—less transparent, harder for newcomers, the independent stations ever more tied to the majors, Viktoria Trifonova, Senior Analyst at Yakov & Partners, told Kommersant. The state has reached for limits, subsidies, and hands-on redistribution ever since the 2018 price crisis.

Keeping the independent gas station chains alive was never the goal, NEFT Research’s Dmitry Prokofiev wrote in Kommersant—it was to keep fuel flowing to the big cities of European Russia and, above all, to the priority government sector.

Occupation officials in Sevastopol and occupied Crimea are telling residents the fuel crisis is easing—and this week they resumed “free sale” at a handful of named stations. From 6 August, every grade would again be sold openly on the TES network, occupation governor Mikhail Razvozhaev said, and AI-92, he noted, has been cut and fixed at no more than 100 rubles per liter ($1.23).

The catch is in the same announcement: no more than 20 liters per car, volumes the governor himself called small, and—at ATAN’s seven stations the same day—no filling canisters.

In occupied Crimea, the ATAN network capped diesel at 30 liters per customer and charged 119 rubles per liter ($1.46), the Crimean Tatar Resource Center reported.

Occupation authorities blame logistics and promise the caps will loosen and prices will fall once supply stabilizes. But shortages, high prices, and rationing show that the peninsula’s supply problems are far from solved, the center said. Crimea is caught in a shortage that now stretches across Russia, from filling stations to farms.

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None of this is new. Sevastopol restricted fuel sales on 22 May, Crimea on 29 May, and for weeks drivers have been buying by QR code. Through the summer, Ukraine’s drone campaign has been draining the seaborne lifeline that feeds the peninsula. The worsening supply of fuel, power, and water is a natural consequence of the war and the occupation, Ukraine’s military intelligence said.