Oil Slides as US Pushes Ukraine Peace Framework, Raising Oversupply Concerns

Oil prices fell sharply on Wednesday, with Brent down $1.38 to $63.51 and WTI down $1.30 to $59.44, after reports that the U.S. is pushing a new framework to end the Russia-Ukraine war. The U.S. proposal — which would require Ukraine to concede territory and some weapons — raised expectations that an end to the conflict could increase Russian oil flows and worsen global oversupply. Analysts warned that prices could fall into the low $50s as sanctioned Russian barrels eventually return to the market. U.S. sanctions on Rosneft and Lukoil, set for a Nov. 21 wind-down deadline, have already cut Moscow’s oil revenues, though Russia insists it will meet its OPEC+ quota by early next year. A larger-than-expected draw in U.S. crude inventories provided some support, but analysts say weakening fundamentals and “headline fatigue” will likely keep prices rangebound in the near term.

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Asia Diesel and Jet Fuel Margins Reach Two-Year Highs Amid Supply Tightening

Asian diesel markets surged after ICE gasoil gains and afternoon trading strength, with jet fuel market structures steepening into wide backwardation. ICE gasoil was supported by a ban on Russian oil-derived fuel for contract deliveries, tightening supply, though physical deliveries to northwest Europe remain possible. East-west price spreads returned to $80/mt discounts, while refining margins for diesel (GO10SGCKMc1) hovered at two-year highs of $31.5/bbl after a third consecutive climb. Jet fuel markets also strengthened, with Regrade JETREG10SGMc1 premiums hitting 60–70 cents/bbl, supported by regional demand from Pertamina and Qatar Energy. Overall, tighter supply expectations in Southeast Asia and limited cargo sources in northeast Asia underpinned firm margins and backwardation.

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India-Bound Russian Oil Shipments Surge Ahead of US Sanctions Deadline

At least 7.7 million barrels of Russian Urals crude from sanctioned producers Rosneft and Lukoil are en route to India ahead of the US sanctions wind-down ending November 21. Most shipments are destined for Reliance Industries’ Jamnagar refinery or Nayara Energy’s Vadinar port, with delivery dates spanning late November into December. Five of India’s seven refiners have pledged to stop Russian crude purchases after the deadline, while Nayara continues lifting cargoes and Indian Oil Corp. focuses on non-sanctioned grades. The US has previously granted waivers to countries like Hungary and some Lukoil transactions, but it is unclear if India has sought similar exemptions. If deliveries miss the deadline, tankers could be left idling offshore or rerouted, potentially to Malaysia or China, amid concerns over secondary sanctions.

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Lukoil’s Teboil to Shut 430 Finnish Petrol Stations Amid US Sanctions Impact

Finnish fuel retailer Teboil, which operates 430 petrol stations (about 20% of Finland’s 2,250 stations), announced it will shut down operations as fuel supplies run out due to US sanctions imposed on its parent company, Lukoil. This marks the first closure of a Lukoil-owned international business as the sanctions disrupt the company globally, including force majeure at Iraq’s West Qurna 2 oilfield and halted projects in Romania and Bulgaria. Teboil stated stations will close in phases, though no specific timeline was provided. The shutdown risks jobs for 1,200 service-station employees plus 180 workers at Lukoil’s lubricants plant in Hamina. Finland’s government said national fuel supply remains secure as Teboil sources fuel from Neste, and customers can shift to other retailers.

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EU Considers New Sanctions on Russia’s Shadow Fleet Amid Rising Tensions

The EU is set to discuss new sanctions targeting Russia’s “shadow fleet” of tankers, aiming to disrupt Moscow’s oil revenues funding the war in Ukraine. Plans include engaging flag states that register these vessels and possibly port and coastal authorities to enforce de-registration and clamp down on sanction evasion, forming part of the bloc’s 20th sanctions package. Simultaneously, EU ministers are debating funding options for Ukraine, with proposals including a €90 billion grant or debt-backed loan, but legal and timing challenges remain, especially with Belgium requesting detailed legal text. The discussion coincides with growing security concerns in Europe, including hybrid attacks such as the recent Polish railway sabotage attributed to Russia. EU officials emphasized the need to respond strongly to Russian actions intended to instill fear and undermine support for Ukraine.

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Saudi Arabia’s September Crude Exports Reach Seven-Month High

Saudi Arabia’s crude exports rose to 6.46 million bpd in September, the highest level since February, according to JODI data. Crude production climbed to 9.966 million bpd, the country’s strongest output since April 2023. Refinery throughput increased slightly to 2.94 million bpd, while direct crude burning declined by 122,000 bpd. UBS noted that although Saudi Arabia raised production by 244,000 bpd, most of the additional barrels were absorbed domestically, as exports grew only marginally. OPEC+ has lifted output targets by 2.9 million bpd since April but plans to pause further increases in early 2026 amid concerns of oversupply, while Saudi Arabia is projected to ship at least 36 million barrels to China in December.

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Japan and Saudi Aramco Renew Okinawa Crude Storage Deal for Three Years

Japan’s JOGMEC has renewed its crude storage agreement with Saudi Aramco for another three years, continuing a partnership that began in 2010. Under the deal, Aramco will store about 1.3 million kilolitres of crude in 13 national stockpiling tanks on Okinawa. In return, Japan gains preferential access to this stock during emergencies. Okinawa serves as a strategic supply hub for Aramco, helping it meet growing crude demand across Asia. The lease arrangement is routinely renewed every three years, reflecting its long-term strategic importance.

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Alaska Oil Production Set to Rise 13% in 2026, Hitting Highest Level Since 2018

The U.S. EIA forecasts Alaska crude oil production will reach 477,000 bpd in 2026, a 13% increase or 55,000 bpd—the largest annual gain since the 1980s. Growth is driven by the North Slope projects: ConocoPhillips’ Nuna, producing 20,000 bpd at peak, and Santos/Repsol’s Pikka Phase 1, expected to reach 80,000 bpd by mid-2026. These new wells are outperforming most Alaskan wells, with an average of 480 barrels of oil equivalent per day (boed) compared to 78% of wells producing under 400 boed in 2023. The increase represents nearly 20% of total Alaska production in 2025. The expansion follows recent federal policy changes, including the rollback of Biden-era drilling limits on Alaska’s largest undisturbed public land.

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Red Sea Crisis Pushes EU Shipping Emissions to Record High

Geopolitical disruptions in the Red Sea forced container ships to reroute around Africa, driving European Union shipping emissions up 13% in 2024—the highest on record. Despite flat trade volumes, ships traveled farther and faster to maintain schedules, reversing the previous decline in per-ship emissions since 2018. Container ships were the main contributor, with boxship emissions surging 47% compared to 2023, while LNG carrier emissions fell 22%. Emissions from oil imports rose to 2019 levels due to longer transport distances. Transport & Environment called for stronger policies to promote cleaner fuels and energy efficiency, noting delays in the IMO’s net-zero shipping incentives due to lobbying by the US and Saudi Arabia.