Oil price jumps after attack on major Russian export terminal

Oil prices rose sharply on November 14 after a Ukrainian drone attacked an export terminal in the Black Sea port of Novorossiysk. The incident intensified market concerns over possible disruptions in oil and oil products supplies in case of further escalation.

Futures for the benchmark grade of oil Brent rose in the night on November 14 at the auction in London by 2.4% - to $ 64.9 per barrel, contracts for delivery of North American grade WTI rose in price by 3.3% - to $ 60.65. Subsequently, the growth of Brent corrected to 1.4%, WTI - to 1.5%.

According to Russian authorities, the Ukrainian drone attack damaged an oil depot at the Sheskharis transshipment complex, which is used to export Russian and Kazakh oil, as well as coastal structures.

"The Ukrainian drone attack on the port of Novorossiysk has raised fresh fears of disruption to oil supplies as the port is Russia's second largest oil export hub and it comes shortly after another major attack - on Tuapse just two weeks ago," Reuters quoted Sparta Commodities oil market analyst Jun Guo as saying. "The extent of the damage is still unknown, but if the escalating trend continues, there will be a reduction in the supply of both oil and oil products from Russia," she added.

On November 12, oil prices collapsed by 4% after OPEC changed its forecast - the cartel said it is now preparing for a supply glut in 2026 instead of the previously expected deficit. The next day, the U.S. Energy Information Administration (EIA) reported a larger-than-forecast increase in the country's crude oil inventories last week, while gasoline and distillate stocks fell less than expected.

Goldman Sachs on November 13, following the International Energy Agency (IEA) revised the "bullish" forecast of oil demand. One of the largest Wall Street banks now believes that global demand will increase until 2040. Last year, the bank predicted a peak by 2034, assuming that due to the slow adoption of electric vehicles, growth may peak six years later, Bloomberg writes.

Goldman Sachs attributed the revised forecast to bottlenecks in low-carbon technologies and infrastructure, as well as rising energy demand. "We are not plotting major breakthroughs in low-carbon technologies," Goldman analysts wrote. According to them, the key driver of oil consumption after a long "plateau" in the road transportation segment will be petrochemicals with a significant contribution from aviation.

This article was AI-translated and verified by a human editor