Oil prices inched higher on Thursday after renewed Ukrainian attacks on Russian oil infrastructure raised concerns over potential supply disruptions, while stalled peace negotiations dimmed hopes of a deal that could restore Russian crude flows to global markets. However, weaker market fundamentals kept the gains modest.
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By 0349 GMT, Brent crude was up 24 cents, or 0.38%, at $62.91 a barrel, while U.S. West Texas Intermediate (WTI) rose 29 cents, or 0.49%, to $59.24.
Ukraine struck the Druzhba oil pipeline in Russia’s Tambov region, a key supply route that transports Russian oil to Hungary and Slovakia, according to a Ukrainian military intelligence source. It was the fifth such attack on the pipeline. Despite the strike, the operator and Hungary’s national oil and gas firm said flows through the pipeline remained normal.
Analysts say Ukraine’s tactics reflect a new phase in its campaign targeting Russia’s refining infrastructure.
“Ukraine’s drone campaign… has shifted into a more sustained and strategically coordinated phase,” consultancy Kpler noted, adding that the repeated strikes aim to prevent refineries from stabilising operations.
As a result, Russian refining throughput has fallen to around 5 million barrels per day between September and November — a 335,000 bpd year-on-year decline. Gasoline production has been hit hardest, with gasoil output also significantly reduced.
Sentiment in the oil market was further shaped by indications that progress toward a Ukraine peace deal had stalled. Representatives of U.S. President Donald Trump reported no breakthroughs in talks with the Kremlin, with Trump stating it was “unclear what happens now.”
“Crude will likely remain stuck in a narrow range while the Ukraine peace efforts grind on,” said Vandana Hari of Vanda Insights.
Expectations of a peace agreement had previously pressured prices downward, as traders anticipated that a deal could lift sanctions on Russian oil and increase global supply at a time of persistent oversupply.
Adding to tensions, Ukrainian naval drones targeted two sanctioned tankers in the Black Sea headed to a Russian port to load oil bound for foreign buyers.
Meanwhile, Fitch Ratings on Thursday revised down its oil price assumptions for 2025–2027, citing an oversupplied market and projections of output growth exceeding demand.
