Oil Jumps after Russia Halts Exports from Major Oil Hub


   
Karim Bastati
DTN Analyst

   VIENNA (DTN) -- Oil prices jumped around 1.5% Friday (11/14) morning after a 
Ukrainian strike on Russia's main Black Sea port forced the suspension of oil 
loading operations.

   The NYMEX WTI contract for December delivery jumped $1.01 to $59.70 bbl, and 
ICE Brent for January delivery rose $0.87 to $63.88 bbl.

   December RBOB gasoline futures edged up $0.0175 to $1.9772 gallon, and 
front-month ULSD futures advanced $0.0651 to $2.5298 gallon.

   The U.S. Dollar Index was little changed, down 0.080 points to 98.970 
against a basket of foreign currencies.

   Ukrainian attacks reportedly damaged an oil depot and a vessel in the port 
of Novorossiysk. The port is one of Russia's main oil export hubs, loading more 
than 700,000 bpd of Russian crude oil exports. It also houses the terminal for 
most seaborne Kazakh crude oil exports, amounting to some 1.5 million bpd. 
While Russia suspended exports from the port, the terminal handling Kazakh 
exports seems to be unaffected.

   The extent of the damage and duration of the export pause remain unclear, 
although the newest attack fueled supply risk concerns that added to the 
geopolitical risk premium in oil. Ukrainian attacks on Russian energy 
infrastructure have so far mostly affected the downstream sector, leading to 
fuel shortages and fuel export bans, but barely impacting crude oil supply.

   In its monthly oil market report published yesterday, the International 
Energy Agency flagged elevated risks to Russian crude oil supply posed by fresh 
U.S. and U.K. sanctions on the country's two largest oil producers, Rosneft and 
Lukoil, and threats of secondary sanctions on buyers of Russian energy. While 
Russian crude oil export volumes have so far proven resilient to sanctions, the 
IEA did flag rapidly swelling volumes of Russian oil on water as some cargoes 
struggle to find buyers ahead of the new sanctions coming into force on 
November 21.

   At the same time, the Paris-based energy watchdog raised its forecast on 
next year's global oil surplus to 4.09 million bpd from a prior 3.97 million 
bpd. This was despite OPEC+ halting output increases in the first quarter of 
2026, citing historically low demand growth versus healthy output growth in 
non-OPEC oil production. The report also noted that global inventories expanded 
for the ninth consecutive month in October.

   In the U.S., crude oil inventories grew more than expected last week. The 
U.S. Energy Information Administration on Thursday reported a 6.4 million bbl 
build to commercial crude oil stocks in the week ending November 7. At 427.6 
million bbl, inventories were 11.6 million bbl higher than two weeks earlier.




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