Commentary on Political Economy

Saturday 6 April 2024

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Biden Tells Ukraine Not to Hit Russia

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The Editorial Board

April 5, 2024 5:40 pm ET

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Smoke rises over an oil depot hit by fire, Ryazan Region, Russia, March 13. Photo: Alexander Ryumin/Zuma Press

President Biden’s policy of ambivalence toward Ukraine means that he has provided enough weapons to avoid defeat (at least so far) but with enough constraints that Kyiv also hasn’t been able to win. Witness U.S. unhappiness about Ukraine’s recent strikes on Russian territory.

Ukraine has struck at least 15 of Russia’s 30 major refineries since January. The West has been reluctant to let Ukraine use donated weapons to strike Russian territory, so Kyiv has relied on its own drones to do it. On Tuesday Ukrainian drones targeted Russia’s third-largest oil refinery, as well as a facility that manufactures Shahed drones. And on Friday Ukraine struck Russia’s Morozovsk air base, destroying several military aircraft.

Some of these attacks occurred more than 750 miles from the Ukrainian border, a testament to Ukraine’s military innovation. The Institute for the Study of War said the April 2 strikes represent “a significant inflection in Ukraine’s demonstrated capability to conduct long-range strikes far into the Russian rear.”

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But last month the Financial Times reported the Biden Administration had urged Ukraine to halt its campaign targeting Russian refineries and warned that “the drone strikes risk driving up global oil prices and provoking retaliation.”

U.S. Ambassador to NATO Julianne Smith said Tuesday that “in terms of actually going after targets inside Russia, that is something that the United States is not particularly supportive of.” State Department spokesman Matthew Miller declined last week “to speak to specific conversations” regarding the Russian refineries. But he said “it has always been our position since the outset of this war that we do not encourage or support Ukraine taking strikes outside its own territory.”

So Ukraine has to suffer attacks on its territory, but it can’t hit back at its aggressor? Striking Russian air bases and drone facilities have obvious military value, and Russia’s refineries obviously help to fuel and finance the Kremlin’s war machine. Between Feb. 24, 2022, and January 2024, Russia has damaged or destroyed some $9 billion in Ukrainian energy infrastructure, according to the Kyiv School of Economics.

Ukraine’s strikes have disrupted between 10% and 14% of Russia’s refinery capacity. British defense intelligence notes that “depending on the extent of the damage, major repairs could take considerable time and expense.” Russia will also have to deploy air defenses to protect its refineries.

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Ukraine’s goal with the strikes is to complicate Russia’s efforts to fuel its troops. S&P Global Commodity Insights estimates that in May 2022 Russia’s military campaign was consuming nearly 6% of domestic diesel output. Moscow has since made some energy data national secrets. But George Voloshin of Aperio Intelligence estimates the armed forces continue to consume between 11.2 and 14.9 million liters of fuel a day, roughly 3.5% to 4.5% of Russia’s total daily consumption.

Sanctions have created spare refining capacity in Belarus, but Russia may have to reconfigure the routes it uses to get fuel to the front. Vladimir Putin will prioritize filling tanks over Russians’ cars, and the refinery attacks will likely cause local fuel disruptions that bring the war home to Russians.

Despite sanctions, oil and gas revenues accounted for 32% of Russia’s total federal budget in 2023, according to a paper by Vitaly Yermakov of the Oxford Institute for Energy Studies. The refinery strikes have prompted Russia to impose restrictions on gasoline exports between March 1 and Sept. 1. Russia will likely try to offset this by increasing crude oil exports, but Ukraine could also target Russia’s oil export terminals.

Ukraine’s strikes on Russia won’t decide the war’s outcome, but they are important as Ukraine’s dwindling ammo and air defenses limit other options. While Mr. Putin continues to escalate, the White House frets about the Russian response to any perceived escalation. The bigger geopolitical risk is what will happen if Ukraine falls to Russian aggression. If the U.S. won’t offer more arms, the least it can do is get out of Ukraine’s way.

Wonder Land: Franklin D. Roosevelt responded to growing threats abroad with a much needed U.S. defense buildup. The Biden Democrats' approach is to focus on domestic spending only. Images: AP/Bloomberg News Composite: Mark Kelly

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