Ukraine Resumes Refinery Strikes as Energy Ceasefire Fails

Ukraine has resumed attacks on Russian refineries, ending a three-day pause that was agreed at the request of Washington. President Volodymyr Zelenskyy confirmed the shift in strategy in an interview with the Financial Times, stating that the block on attacking refineries is out and the pause is over. This move shatters the narrative of an "energy ceasefire" that had briefly emerged from recent diplomatic efforts.

The proposed truce was announced by President Donald Trump on Sunday, aiming to stop the mutual targeting of power facilities and lower the price of oil and diesel ahead of the U.S. midterm elections. Ukraine honored this agreement for three days, refraining from both attacks and retaliation. However, Kyiv officials state that the deal was broken by Moscow, which launched a massive assault on Ukrainian energy infrastructure during the pause.

Zelenskyy told the Financial Times that Russia launched approximately 40 ballistic missiles during the ceasefire period. He said he had warned U.S. officials that Russia would violate the ceasefire. The Ukrainian president also cited the apparent shutdown of Starlink services as a critical factor in the collapse of the truce. Serhii Beskrestnov, an adviser to Zelenskyy on defense technology, noted that SpaceX implemented a speed limit on Starlink terminals in motion without notifying Ukrainian defense forces.

The restrictions on Starlink and its sister service, Starshield, have disrupted military operations by stripping Ukraine of advance warnings of incoming ballistic missiles. Elon Musk, SpaceX CEO, stated that the U.S. government is ultimately responsible for curbs on Ukraine's military-grade Starlink network, noting that Starshield systems are owned and controlled by the U.S. government. Zelenskyy described the reported Starlink shutdown as an "absolutely crazy" move inconsistent with the behavior expected between partners.

In a separate interview with Piers Morgan, Zelenskyy expressed feeling let down by Trump's recent dealings with Vladimir Putin. He acknowledged feeling betrayed by the events but stressed that Ukraine's survival and its strategic relationship with the U.S. mattered more than his personal emotions. The White House and SpaceX did not respond to CNBC's request for comment.

Our read: The energy ceasefire was a temporary hedge against volatility. With Ukraine back on the offensive and the diplomatic bridge broken, crude oil futures face renewed upward pressure. The market must now price in the risk of sustained escalation rather than a fragile truce.