Global oil prices climb amid fresh fears of supply disruption

Oil prices climbed on Friday as fresh worries over global supplies rippled through energy markets after a Ukrainian drone strike hit a major Russian export hub on the Black Sea.

Traders reacted sharply to early morning reports from Novorossiysk, where a ship, nearby homes and an oil depot were struck in what Russian officials described as a large attack. Three crew members on the vessel were reported injured. The port is one of Russia’s most important gateways for crude shipments, which made the incident even more unsettling for markets already on edge.

By mid-morning, Brent crude was trading at $64.25 a barrel, up $1.24. West Texas Intermediate touched $59.94 after gaining $1.25. The nearly 2 percent rise in both benchmarks showed how sensitive traders remain to any disruptions linked to the war.

Energy analysts said the strike raised the prospect of further interruptions if similar attacks continue. June Goh, a senior analyst at Sparta Commodities, noted that Novorossiysk handles a large share of Russia’s seaborne exports and was already feeling the strain after an earlier attack at Tuapse two weeks ago. She said that if the pattern holds, Russia could see reductions in both crude and fuel exports.

The spike followed a week of mixed signals for the market. Brent has added close to 1 percent over the past five days, while WTI inched up less than half a percent. Earlier losses came after an OPEC assessment suggested that global supply is expected to meet demand by 2026, softening earlier predictions of a shortfall.

The latest figures from the US Energy Information Administration also added to the uncertainty. American crude stocks rose by more than 6 million barrels last week, far above expectations. Gasoline and distillate inventories, however, declined by less than forecast, which hinted at a weaker pull from refiners and consumers.

At the same time, investors are watching how Western sanctions could steer Russian oil away from its usual buyers. Washington has announced new restrictions on energy giants Lukoil and Rosneft in an effort to pressure Moscow over the war in Ukraine. From November 21, US regulations will block transactions with the two companies.

Banks tracking the flow of Russian oil say the sanctions are already complicating shipments. JPMorgan estimated that more than a million barrels per day of Russian crude is now sitting on tankers because of slower unloading linked to the sanctions. The bank warned that once the cut-off date arrives, moving those cargoes may become even harder.

With the winter months approaching, traders say any fresh disruption at key ports like Novorossiysk could have an outsized effect on global prices.