Oil prices rose on Monday as investors assessed the impact of Ukrainian drone attacks on Russian refineries that could disrupt its crude and fuel exports, while also eyeing US fuel-demand growth.
Brent crude futures rose 36 cents, or 0.5 per cent, to $67.35 a barrel by 7:32 AM WAT, while U.S. West Texas Intermediate crude was at $63.05 a barrel, up 36 cents, or 0.6 per cent.
Both contracts gained more than one per cent last week as Ukraine stepped up attacks on Russian oil infrastructure, including the largest oil exporting terminal, Primorsk, and the Kirishinefteorgsintez refinery, one of the two largest refineries in Russia.
Primorsk has a capacity to load about one million barrels per day (bpd) of crude, making it a key export hub for Russian oil and the largest port in western Russia.
The refinery, operated by Surgutneftegaz, processes about 17.7 million metric tons per year, or 355,000 bpd, of Russian crude, equal to 6.4 per cent of the country’s total.
An oil company in Russia’s Bashkortostan region will maintain production levels despite a drone attack on Saturday, Reuters said, quoting regional governor Radiy Khabirov.
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Pressure is mounting on Russia as US President Donald Trump reiterated on Sunday that he is willing to impose sanctions on Russia, but Europe has to act in a way that is commensurate with the United States.
Investors are also watching US-China trade talks in Madrid that started on Sunday amid Washington’s demands that its allies place tariffs on imports from China over its purchases of Russian oil.
