Oil Rises As Russian Port Suspends Exports After Ukrainian Attack

Oil

Oil prices settled more than 2% higher on Friday as Russia's port of Novorossiisk halted oil exports following a Ukrainian drone attack that hit an oil depot in the Russian energy hub, stoking supply concerns.

Brent crude futures settled at $64.39, while US West Texas Intermediate (WTI) crude finished at $60.09. For the week, Brent rose by 1.2% and WTI rose by 0.6%.

The Russian port of Novorossiisk paused oil exports, equivalent to 2.2mn barrels per day, or 2% of global supply, and oil pipeline monopoly Transneft suspended crude supplies to the outlet.

Ukraine on Friday said it separately struck an oil refinery in Russia's Saratov region and a fuel storage facility in nearby Engels overnight.

Investors are assessing how recent attacks impact long-term Russian supply while watching how Western sanctions affect the country’s oil output and trade flows.

Gas

Asian spot LNG prices were flat for a second consecutive week, as steady supplies of contracted cargoes and overall weak demand across the region outweighed modest spot market interest.

The average LNG price for December delivery into northeast Asia held at $11.10 per million British thermal units (mmBtu), industry sources estimated.

Current price levels are still too expensive for most price sensitive buyers, but minor supportive news came from Indonesia and Egypt that signalled higher domestic demand, adding a bit of tightness to the current circumstances.

In Europe, the Dutch TTF price settled at $10.56 per mmBtu, recording a weekly loss of 0.1%. Gas prices were under bearish pressure as oversupply, weak Asian demand, high freight rates, and strong US liquefaction kept cargoes in the Atlantic basin.

This article was supplied by the Abdullah bin Hamad Al-Attiyah International Foundation for Energy and Sustainable Development.