- Oil fluctuates on multiple geopolitical factors
- WTI fell by nearly $2/Bbl this morning to trade near $85/Bbl
- An oil tanker off the coast of Oman was hit by a bomb-carrying drone
- The Druzhba oil pipeline that transports crude from Russia to eastern Europe resumed flows today after an outage on Tuesday
- Yesterday, Poland was hit by two missiles, increasing the likelihood that the conflict between Russia and Ukraine may escalate
- The headlines come as ongoing worries about how sanctions on Russian crude and an escalation of the Russia-Ukraine conflict will affect the market
- However, some concerns of a further escalation have subsided after Biden and other leaders said that it is unlikely that the missiles that hit Poland were launched from Russia
- Additionally, China’s strict zero-Covid policy continues to weigh on oil demand
- The Druzhba oil pipeline, a key oil pipeline that transports Russian crude to Eastern Europe, was shut down yesterday as a result of a power failure (BBG, Reuters)
- A transformer station that supplies electricity to the pumping station was hit by Russian artillery, according to MOL, a Hungarian oil and gas company
- Flows were resumed on Wednesday after Ukraine completed repairs to restore power, according to Hungary's foreign minister Péter Szijjártó
- He added that the pipeline itself did not seem to be damaged during a series of missile assaults against Ukraine's energy infrastructure yesterday
- The pipeline supplies several eastern European nations like Hungary, Slovakia, and the Czech Republic and has a capacity of 1.2 to 1.4 MMBbl/d
- Biden is considering U.S. fuel export limits as diesel stocks in the northeast deplete (BBG)
- President Biden may order oil companies to store more fuel in the U.S. in an effort to ensure a sufficient supply of heating oil for the Northeast, said Energy Secretary Jennifer Granholm on Tuesday
- “It may not be a business choice that they make, but we’re asking, as the companies that are operating in America, to do what they are doing in other countries” where there are minimum fuel-storage requirements, said Granholm. “And that’s why the president is looking at that”
- The Biden administration is considering multiple options to respond to high fuel prices and low inventories