(KYIV) – Russia’s oil income has fallen sharply after the price of its Urals crude blend dropped to about 36.61 United States dollars per barrel, a level far below its estimated break even cost. Analysts say the fall is the result of strengthened Western sanctions and Ukraine’s expanding campaign of drone and missile strikes on Russian energy infrastructure. Ukrainian officials view the development as evidence that sustained pressure is starting to damage the Russian war economy in a measurable way.
Economists note that inflation over recent years has pushed up Russia’s production and export expenses, making the current revenue level unprofitable. Moscow continues exporting even at a loss, as storing large volumes of oil would force it to shut down wells in Siberia. Reopening these wells can be technically difficult and expensive, and some experts believe Russia may no longer possess the full capability to do so reliably.
A recent assessment by the Centre for Research on Energy and Clean Air reported that Russian fossil fuel exports in October fell to their lowest level since the full scale invasion of Ukraine. The think tank estimated Russia earned about $609 million each day in October, a four percent fall from September. The report noted that both sanctions and Ukrainian strikes are driving the decline, and it expects further weakening in the coming months.
One factor behind the oil price drop is reduced buying from India and China as new United States sanctions take effect. Data from Bloomberg shows the discount between global benchmark Brent crude and Russia’s Urals blend widening to more than 23 United States dollars per barrel, pushing Urals down to the mid thirties. This is its steepest fall since the early months of the war.
Ukraine continues to attack energy infrastructure inside occupied territories and deep inside Russia. Recent drone footage released by Ukrainian units shows multiple strikes on a major power plant in occupied Donetsk, causing extensive fires and leaving large areas of the city without electricity. Ukrainian forces also targeted a five hundred kilovolt substation in the Vladimir region inside Russia, part of what Kyiv describes as a nightly campaign to erode the Russian military’s ability to wage war.
Ukraine additionally struck several key Russian air defence assets in the Donbas, including a Tor M1 system, an S400 command post and a Buk M3 radar. Military analysts say improved Ukrainian drones can now pinpoint radar emissions and evade electronic interference more effectively than before.
Russian industrial centres continue to face accidents and disruptions. An explosion on a major gas pipeline near Omsk in Siberia sent flames high into the air and forced several factories offline. State company Gazprom claimed repairs could be completed within a day, although independent experts question the timeline based on the scale of the blast.
Ukrainian drones also hit the Zincum plant in the Kursk region, a facility that produces zinc alloys and chemicals for Russia’s defence sector. The attack disrupted around ten percent of the national zinc supply chain. Meanwhile, Russia’s largest silicon plant announced it will halt all production from January due to collapsing demand and cheaper imports, a sign of growing structural pressure on Russian industry.
Business data also shows Russian companies face record debt burdens as interest payments now absorb nearly forty percent of pre tax profits. Losses among unprofitable firms rose thirty percent in September alone. Analysts say the low formal debt of the Russian state masks the much heavier debt accumulated by private firms under government pressure.
Public frustration is becoming more visible. A rare sanctioned protest in Novosibirsk featured a speaker criticising rising taxes, inflation and economic hardship. The government plans to raise value added tax from twenty to twenty two percent to fund the war, a move expected to increase costs for ordinary Russians.
Russia continues its nightly attacks on Ukrainian energy sites. Ukrainian air defences reported intercepting one hundred and thirty nine out of one hundred and seventy six drones launched during a recent wave of strikes. Russian missiles hit civilian areas in the Kharkiv region, killing three people and injuring several others, including children. Separately, a Russian drone struck a Turkish liquefied natural gas tanker in the Danube corridor, raising new concerns about the safety of foreign vessels supporting Ukraine’s energy needs.
Romania evacuated a village after a Russian drone hit a ship only 500 metres from its border. In Poland, authorities said Russian intelligence was likely behind an attempt by two Ukrainian nationals working for Moscow to sabotage a railway line crucial for transporting Western military aid to Ukraine.
A widely followed Ukrainian activist and military supporter recently warned of increasing Russian pressure in the Zaporizhzhia region, arguing that Russia aims to bring major cities such as Dnipro and Zaporizhzhia within artillery range. Military experts in Kyiv acknowledge the danger but emphasise that Russia’s advance remains slow and costly. They believe Ukraine’s strategy of trading territory for time is justified if Russia’s economy continues weakening at its current pace.
Stories from captured Russian soldiers illustrate the strain inside Russia’s military. A recent recording of a prisoner of war, an ethnic Kazakh from Russia, showed him telling his mother he would never return to Russia, describing his treatment on the battlefield as inhumane and stating that Ukrainian forces treated him far better in captivity. Analysts say such accounts reflect growing morale problems among Russian troops.
In the United States, Senator Lindsey Graham said Congress is preparing to move forward with a broad Russian sanctions bill after president Donald Trump signalled support. Observers warn that Trump tends to back measures that benefit American corporate interests rather than Ukraine directly. For example, the easing of restrictions on the purchase of overseas assets from Russian oil company Lukoil has allowed US firms such as Chevron to consider acquisitions.
Elsewhere, citizens in the Czech Republic crowdfunded more than $700,000 to purchase a Flamingo cruise missile for Ukraine. The manufacturer then doubled the contribution by providing a second missile. An anonymous donor in the Netherlands supplied more than seven hundred shotguns and twenty thousand rounds of ammunition to Ukraine’s forces, while Lithuania delivered seven thousand glass insulators to support Ukraine’s power grid repairs.
Ukraine also secured a new gas supply route through Greece for the winter ahead, following talks between President Volodymyr Zelensky and Greek officials. Zelensky later travelled to Paris, where he and French President Emmanuel Macron signed a defence procurement deal that includes plans for Ukraine to receive up to one hundred Rafale fighter aircraft as part of a long term cooperation programme.
France’s support comes alongside deliveries of Swedish Gripen jets and United States F16s, strengthening Ukraine’s future air defence and combat capabilities.
Amid the conflict, Ukrainians celebrated a moment of national pride after the country’s football team defeated Iceland two nil in a World Cup qualifying match, securing a place in the next tournament. The result prompted scenes of celebration in cities including Lviv.
The war continues to impose a heavy cost, with Ukraine losing many of its most committed defenders on the front line. Yet support from allies and mounting economic pressure on Russia remain central to Kyiv’s strategy of forcing a long term collapse in the Russian war effort.