Geopolitical Tensions and OPEC Decision Push Oil Above $63

Oil prices rose more than 1% on Monday, with Brent settling at $63.17 per barrel and WTI at $59.32, driven by Ukrainian drone attacks on Russian-linked oil assets and the U.S. closure of Venezuelan airspace. Analysts highlighted heightened fears of lost Russian crude supply, especially after Ukraine struck two tankers and damaged a mooring point at the CPC terminal, which handles 1% of global oil. Despite the damage, Chevron confirmed that loadings at Novorossiysk continued using two moorings. OPEC+ added market support by maintaining current production levels for Q1 2026, easing concerns about a supply glut. The price increase comes after both Brent and WTI posted four consecutive months of declines, their longest losing streak since 2023.

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CPC Resumes Limited Exports After Drone Strike Cuts Kazakhstan Oil Flows

The Caspian Pipeline Consortium (CPC), which handles over 1% of global oil and around 80% of Kazakhstan’s exports, resumed shipments from a single mooring point (SPM 1) after a Ukrainian drone attack severely damaged SPM 2 and halted operations. The attack, part of Ukraine’s ongoing strikes on Russian oil infrastructure, reportedly halved CPC exports, with shippers saying intake from producers was cut by 40%, leaving only 2.5 days of storage available. SPM 3 has been offline since Nov. 12 and may take up to two months to repair, raising the risk of further export constraints. Before the attack, December CPC Blend exports were expected to reach 1.7 million bpd, up from 1.45 million bpd in November. CPC plans to replace both SPM 1 and SPM 2 next year, with new units expected to be completed in December.

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Third Russia-Linked Tanker Hit by Explosions Near Senegal

The Panama-flagged tanker Mersin (50,100-dwt) suffered four external explosions while anchored off Dakar, Senegal, flooding its engine room, though all crew members are safe and there was no pollution, Besiktas Shipping confirmed. The vessel, built in 2009, had taken on a cargo at Taman, Russia in August and has been anchored off Senegal since late September. The incident follows a series of attacks on Russian-linked tankers, including the 150,000-dwt Kairos and 115,600-dwt Virat in the Black Sea, believed to involve Ukrainian military drones. Most targeted ships were not on Western sanctions lists, but had carried Russian cargo, suggesting a strategy to pressure shipowners away from Russian ports. Besiktas is cooperating with insurers and Senegalese authorities, while protection and indemnity coverage is provided by NorthStandard, part of the International Group of P&I Clubs.

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India Turns to Guyana to Replace Sanctioned Russian Crude

Two supertankers, Cobalt Nova and Olympic Lion, have departed Guyana carrying about 2 million barrels each on an 11,000-mile voyage to India, marking the first shipments from Guyana to India since 2021. The cargoes, including Guyana’s Golden Arrowhead, Liza, and Unity Gold crude, are scheduled to arrive in January at Indian refineries operated by Indian Oil Corp. and Hindustan Petroleum Corp.. The move comes as Indian refiners seek alternatives to Russian crude, previously importing around 1.7 million bpd, following US sanctions on Rosneft and Lukoil. The shipments highlight India’s efforts to circumvent geopolitical restrictions while maintaining crude supply. This strategy underscores the increasing complexity of global oil trade amid sanctions and tariffs.

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Turkey Cuts Urals Oil Imports as Sanctions Push Shift to Kazakh and Iraqi Crude

Turkey sharply reduced its imports of Russian Urals crude in November to around 200,000 bpd, down 100,000 bpd from October, as tightened U.S. sanctions on Russian majors limited available suppliers. Although Turkey has been the second-largest buyer of Urals since 2022, refiners are increasingly diversifying ahead of the EU’s 2026 ban on fuel made from Russian oil. Imports of Kazakhstan’s CPC Blend surged to 105,000 bpd, the highest since February 2024, while Iraqi Basrah and Kazakh KEBCO volumes also rose. Turkey previously imported up to 400,000 bpd of Urals in June, highlighting the scale of the recent decline. Analysts warn that the shift to CPC Blend may face challenges due to the recent Ukrainian attack on the CPC terminal.

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Iraq’s Khor Mor Gas Field Restarts After Drone Attack Halts Power Supply

Operations at Iraq's Khor Mor gas field resumed early Sunday at 2:00 a.m., restoring gas flows to regional power stations after a drone attack forced a shutdown and caused widespread electricity outages. The attack on Thursday struck a storage tank, prompting operator Dana Gas to halt production, though no group has claimed responsibility. Khor Mor is one of the Kurdistan region’s largest gas fields and is essential for local power generation. The incident follows a series of drone attacks in July that cut regional oil production by around 150,000 bpd. The field sits in the semi-autonomous Kurdish region, home to substantial U.S. energy investments.

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Canada Plans to Increase Trans Mountain Pipeline Capacity Before Selling Stake

Canada will delay selling equity in the C$34 billion Trans Mountain pipeline until its output is optimized, Energy Minister Tim Hodgson said. The government aims to boost the system’s capacity from 890,000 bpd to about 1.25 million bpd through cost-effective optimization projects, while the Vancouver Fraser Port Authority plans dredging to allow larger tanker loads. Ottawa also wants toll disputes—raised by shippers who argue they shouldn’t pay for cost overruns—resolved before a sale, a process that may extend to late 2026 or early 2027. The previous plan to transfer equity to more than 120 Indigenous groups proved complex, and the Carney government has not yet confirmed its approach to Indigenous ownership. A new federal-Alberta agreement emphasizes Indigenous co-ownership for any future pipelines to the British Columbia coast, supported by federal loan guarantees.

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U.S. Gasoline Prices Drop to Four-Year Low Amid Cheap Crude and Weak Demand

Gasoline prices in the U.S. fell to an average of $3.00 per gallon, the lowest since May 2021, driven by cheaper crude oil and stagnant demand. Prices have dropped about 13 cents since the start of President Trump’s second term but remain roughly $1 above his $2 per gallon pledge. Seasonal demand typically falls after summer, and this year, consumption has lagged 2024 levels, helping suppress costs. Regional disparities persist, with Californians paying $4.56 per gallon versus $2.57 in Texas. Despite the decline, gasoline prices remain above the levels seen during the 2020 COVID-19 lockdowns.

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U.S. LNG Exports Reach Record 10.9 Million Tonnes in November

U.S. LNG exports hit a record 10.9 million metric tonnes in November, up from 10.1 mmt in October, supported by cooler Gulf Coast temperatures that improved plant efficiency. Cheniere boosted shipments to 4.6 mmt, while Venture Global held steady at 3 mmt, helping push U.S. gas demand for liquefaction to a record 18 bcfd and even surpassing 19 bcfd on some days. Europe remained the dominant market, taking 70% (7.5 mmt) of U.S. cargoes, with Turkey sharply increasing purchases to 0.9 mmt from just one October cargo. Asian imports fell to 1.75 mmt as Northeast Asian spot demand stayed weak, while Egypt and Latin America saw modest increases. With the Asia-bound arbitrage route still closed, analysts expect flexible U.S. cargoes to continue flowing into Northwest Europe.

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VLCC Spot Rates Remain Extremely Strong Despite Minor Cooling

VLCC owners continue to earn very high returns, with Baltic Exchange spot rates at $137,800 per day, slightly down 5% from the previous day but still at five-year highs. George Economou’s Solana (297,000-dwt) achieved a standout $246,000 per day for a short-haul Middle East Gulf to Thailand voyage, while other fixtures like Maran Thaleia (321,000-dwt) earned $176,000 per day and Sea Gem (320,000-dwt) $138,000 per day. Round-voyage time-charter equivalent earnings remain strong, with Maran Thaleia at $142,720/day over 41 days and Sea Gem at $133,489/day over 45 days. Analysts note that recent minor rate softening is due to improved tonnage availability and shifting laycans, but VLCC earnings are unlikely to fall sharply, staying near $135,000/day with capacity utilization around 93–94%. Market observers expect a gentle slide rather than a major drop in rates in the coming weeks.