Bengaluru/Singapore — Oil prices held firm in early trading on Tuesday as market participants assessed risks stemming from Ukrainian drone strikes on Russian energy sites, mounting US-Venezuela tension and mixed expectations for US fuel inventories.
Brent crude futures rose 7c, or 0.1%, to $63.24 a barrel at 0427 GMT. US West Texas Intermediate (WTI) crude gained 10c, or 0.2%, to $59.42 a barrel.
Both benchmarks advanced more than 1% on Monday, while WTI was near a two-week high.
“Oil held gains as traders awaited President Trump’s moves on Venezuela and assessed Black Sea terminal damage,” Saxo analysts said in a note to clients.
On Monday, the Caspian Pipeline Consortium said it had resumed oil shipments from one mooring point at its Black Sea terminal following a major Ukrainian drone attack on November 29. Russia’s Kommersant newspaper, citing unnamed sources, on Monday said that oil loadings had resumed via the single point mooring 1 (SPM 1), while SPM 2 was damaged.
“The military action further supports our opinion that a peace deal is highly unlikely anytime soon and that the diesel/gasoil markets are on the cusp of pulling the complex back up,” analysts at Ritterbusch and Associates said in a note.
On the negotiation front, Ukrainian President Volodymyr Zelensky said on Monday that Kyiv’s priorities are to maintain sovereignty and ensure strong security guarantees, adding that territorial disputes remain the most complicated sticking point.
US envoy Steve Witkoff is due to brief the Kremlin on Tuesday.
DBS energy sector team lead Suvro Sarkar said “the only other emerging factor” for oil was “the noise around Venezuela”.
“While a full-blown conflict is unlikely, ongoing events could destabilise the country internally and threaten oil production and exports,” he said.
US President Donald Trump spoke with his top advisers to discuss the pressure campaign on Venezuela, a senior US official said. On Saturday, Trump said the airspace above and surrounding Venezuela should be considered “closed in its entirety”, without providing further details.
On Sunday, Opec+ reaffirmed a small oil output increase for December and a pause in increases in the first quarter of next year due to rising fears of a supply glut.
“The Opec+ language on supply management and discipline in the near term remains supportive for oil prices,” said DBS Bank’s Sarkar.
Mixed outlooks on US crude and refined product inventory data weighed slightly on prices, with a Reuters preliminary poll among four analysts showing crude inventories falling but product inventories rising in the week of November 28.
Reuters
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