Russia’s crude oil production outlook has weakened as Ukrainian attacks disrupt refineries and export infrastructure, while ageing fields and a lack of sizeable new developments limit the country’s ability to replace declining output.
Rystad Energy has cut its forecast for Russian crude production to an average of 8.95 million barrels per day (bpd) in 2026, 90,000 bpd below its previous estimate. Output is projected to fall further to about 8.6 million bpd in 2027.
The revision reflects renewed disruptions at western Russian export terminals and rising risks to seaborne exports, which have become less reliable and more expensive following a year of tighter sanctions and Ukrainian attacks on refineries, ports and tankers.
The disruption is increasingly affecting Russia’s upstream sector, with limited room to absorb further shocks.
‘The increasing frequency and effectiveness of drone attacks on Russian oil and gas infrastructure is no longer affecting only refineries; it’s constraining the country’s upstream sector as well,’ said Daria Melnik, vice president, Oil and Gas Research at Rystad Energy.
Russian refinery runs in June and July were among the lowest recorded in the past two decades. Rystad expected refinery throughput to average around 4 million bpd between July and December, almost 30 percent below the 2016-2023 seasonal average of roughly 5.7 million bpd.
As a result, Russia is expected to process about 1.4 million bpd less crude in the second half of 2026 than historical seasonal patterns would suggest.
The barrels that cannot be processed must either be exported, placed into storage or removed from production.
Russia absorbed the imbalance in June, but July showed that its export system could not consistently handle the additional volumes, according to Melnik.
The pressure on production is compounded by elevated onshore inventories. With stocks already above the threshold at which sustained production cuts become increasingly difficult to avoid, producers have less flexibility to maintain output while waiting for refining or export capacity to recover.
Rystad estimates Russia’s spare production capacity at around 620,000 bpd in 2026, rising modestly to 700,000 bpd in 2027. However, much of this capacity is tied to ageing, high-water-cut wells that have been shut in during the current round of production cuts.
The longer these wells remain offline, the less likely they are to return at previous production rates.
Extended shut-ins increase the risk of costly interventions, lower productivity and, in some cases, permanent abandonment when repair and water-handling costs outweigh the economics of restarting production.
This means some of Russia’s nominal spare capacity could be permanently lost, further limiting its ability to raise output from existing fields.
The problem extends beyond the immediate disruption. Russia’s mature oil fields are facing natural production declines, while the country lacks sufficient sizeable greenfield developments to offset those losses after 2027. Even if refinery and export constraints ease, Rystad sees limited scope for a meaningful recovery in crude production.
The global market could add another layer of pressure. Rystad expected the global oil market to move into surplus in 2027 if the conflict in the Middle East eases and disrupted supply flows normalise.
A surplus would put downward pressure on benchmark prices while Russian producers continue to face wider discounts, higher logistics costs and sanctions-related expenses.
At the same time, buyers in China, India, Trkiye, Hungary and Slovakia could gain greater access to non-sanctioned crude, reducing their willingness to accept the legal, financial and operational risks associated with Russian barrels without demanding deeper discounts.
For Russia, that would create pressure on both production and revenue: declining output would coincide with weaker benchmark prices, higher transportation costs and reduced pricing power with buyers.
The combination of disruptions to existing infrastructure, ageing fields and insufficient new projects is therefore narrowing Russia’s options to sustain crude production.