Russia-Ukraine, West Asia and why the energy crisis is moving from oilfields to refineries time is different

If sulphur is any indication, one cannot rule out those possibilities going ahead.

3 min readSep 22, 2026 06:00 AM IST First published on: Sep 22, 2026 at 06:00 AM IST

The energy crisis from the conflicts in West Asia and Russia-Ukraine is taking unprecedented forms. The present crunch isn’t just about crude oil. Brent prices, at about $102 per barrel, are nearly 55 per cent higher than a year ago, but below the March 2022 and July 2008 peaks of $139.1 and $147.5, respectively. The long-range drone and missile strikes by Ukraine and Iran have targeted refineries, driving up the prices of their products and byproducts more than that of crude. Diesel prices in the US are at a record $6.5-plus a gallon, up 76.2 per cent year-on-year. Equally significant is sulphur. In normal times, India was importing this byproduct of refineries and natural gas processing plants — they remove it for making clean, low-emissions fuels — at $200 or less per tonne. Today, that price is at $1,000 and above.

Much of the sulphur recovered from oil and gas production gets converted into sulphuric acid, which is a core chemical for manufacturing phosphatic fertilisers. While the primary raw material for phosphorus (P) is rock phosphate, this ore cannot be used as fertiliser unless broken down into a water-soluble form for plants to absorb. For that, it has to be reacted with sulphuric acid, which then leads to the production of single super phosphate, di-ammonium phosphate and other P-containing complex fertilisers. India has managed to import adequate quantities of both urea and liquefied natural gas to enable the domestic production of this vital nitrogen-containing fertiliser. The same cannot be said, however, be said about phosphatic and complex fertilisers. Their imports as well as domestic manufacturing have been severely constrained by the global shortage of sulphur that is, in turn, courtesy of the sustained attacks on energy infrastructure in Russia and the Persian Gulf countries.

The millions of barrels of oil refining capacity in West Asia and Russia getting knocked out makes this energy crisis different from earlier ones. The shortages now are more in diesel, jet fuel and sulphur than in crude petroleum. This is also reflected in crack spreads — the price difference between crude oil and refined products — surging to all-time highs. That, by itself, may not be bad for India. Its 284.9 million tonnes (mt) output of refined petroleum products in 2025-26 was ahead of its domestic consumption of 243.2 mt and also the installed capacity of 258.1 mt. Thus, the country has no dearth of refining capacity, which also explains why no dry-outs of petrol or diesel are being reported in fuel outlets. But if sulphur is any indication, one cannot rule out those possibilities going ahead.