The key Russian oil port of Novorossiysk on the Black Sea suspended oil exports on Friday, following a major Ukrainian attack on the port overnight, industry sources told Reuters.
In addition, Russia’s pipeline company Transneft suspended crude oil supply to the facilities at the port, according to Reuters’ sources.
The port of Novorossiysk, a key export outlet of crude from Russia and Kazakhstan, and a major wheat export hub, was attacked by Ukrainian drones early on Friday. Oil prices jumped in Asian and early European trade as the incident shifted traders’ focus back to potential supply disruptions.
The front-month futures of WTI, the U.S. crude benchmark, returned to trade above $60 per barrel, following days of lingering in the high $50s amid concerns about the imminent oversupply. Brent Crude futures neared $65 per barrel, as the latest Ukrainian attack reignited geopolitical concerns about global oil supply.
The drone attacks damaged a ship, nearby apartment buildings, and an oil depot, injuring three crew members aboard the vessel, Russian regional authorities confirmed.
Ukrainian forces have increasingly targeted Russian oil-refining, storage, and export infrastructure using drones and missiles. The campaign has gained intensity in recent months, with the Center for European Policy Analysis noting a shift in strategy “from smaller-scale strikes on storage tanks to targeting hard-to-replace refinery equipment, like cracking units, much of it western-made and subject to sanctions.”
Both wheat and crude oil futures jumped early on Friday the attack on Novorossiysk, a key export hub for both grains and oil, Ole Hansen, Head of Commodity Strategy at Saxo Bank, commented.
“Any prolonged disruption would force traders to source supplies elsewhere, adding further support to prices,” Hansen added.
“Brent initially rose by about 3% before paring gains, with the early spike driven largely by short covering after a week in which sentiment had been dominated by concerns about a potential supply glut.”
By Tsvetana Paraskova for Oilprice.com
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