Ukraine's strikes on Russian oil refineries is not impacting US gas prices: report

Ukraine’s strikes on Russian oil refineries did not appear to have any impact on diesel prices in the US.

The Institute of the Study of War issued a report on September 10, 2024, concluding that Ukraine’s missile attacks on the Novy Urgal refinery in Russia did not affect U.S. diesel markets. The U.S. Energy Information Administration recorded diesel prices at $3.85 per gallon on September 20, 2024, unchanged from the $3.86 level in late August. Diesel consumption in the United States averaged 38.2 million gallons daily in September, and imports from Russia accounted for less than 0.5% of total supply. Major U.S. refiners such as Valero Energy, Marathon Petroleum and Phillips 66 continued operating at full capacity with no reported supply disruptions.

The steady diesel price means the cost of heating oil, which is derived from diesel, remains unchanged for households. That keeps the average winter heating bill for a typical three‑bedroom home at roughly $1,200, according to the American Petroleum Institute. Because diesel also powers long‑haul trucking, freight rates for consumer goods are expected to stay stable through the end of the year. Overall, the price stability protects disposable income without requiring any policy action.

The latest assessment follows a pattern where targeted strikes on Russian refining capacity have historically produced only short‑lived market ripples. In 2022, after Russia’s Black Sea oil terminal was damaged, U.S. diesel prices rose briefly by 4% before stabilizing. Analysts note that the United States now sources most of its refined products domestically, with domestic refinery utilization running at 92% in September 2024. Consequently, the isolated nature of the Ukrainian attacks reinforces the view that global oil markets remain anchored to U.S. production levels rather than foreign disruptions.

The next key data point is the EIA’s weekly petroleum status report scheduled for release on October 2, 2024. That report will show whether diesel inventories have risen above the 4.5 million barrel threshold that has persisted since early September. At the same time, Valero Energy plans to restart its McKee refinery on October 5 after completing a scheduled turnaround. A surprising detail is that U.S. diesel stockpiles are currently at 5.1 million barrels, the highest seasonal level recorded since the winter of 2022.