On Tuesday, oil prices rose mainly due to disruptions in Russian and US oil supplies. However, progress in negotiations to end the war in Ukraine limited the gains, as an agreement could restore Russian oil supplies. Brent crude futures rose 0.8% to settle at $75.84 per barrel, while US crude futures increased by 1.6% to $71.85 per barrel, recovering losses from the previous day due to a holiday.
Recently, a Ukrainian drone attack hit a pump station on the Russian Caspian Pipeline Consortium (CPC), reducing the pipeline's oil flow. Russian Deputy Prime Minister Novak stated that oil flow through the pipeline decreased by 30-40%, equal to a daily reduction of 380,000 barrels. UBS analyst Giovanni Staunovo indicated that while Brent crude prices receive short-term support from the CPC supply disruption, the market still needs to monitor the disruption's duration and scale.
Additionally, loading at the Russian Black Sea port of Novorossiysk was halted due to a storm, further heightening supply disruption risks. Meanwhile, a cold wave in the US also impacted oil supplies, with the North Dakota Pipeline Authority predicting a potential drop of up to 150,000 barrels per day in the state's output.
However, the rise in oil prices was limited by US-Russia talks held in Saudi Arabia. These talks aimed to discuss ending the war in Ukraine, but uncertainty persisted due to Ukraine's non-participation and Russia's tougher demands. If the US and Russia reach an agreement, Western countries might lift sanctions on Russian oil supplies, potentially restoring Russian oil exports and affecting global oil prices.
