Oil Extends Losses as Russian Port Resumes Operations, Easing Supply Fears

Oil prices fell further on Monday as market participants reacted to signs of resumed activity at Russia’s key Novorossiysk export terminal on the Black Sea, easing concerns over a prolonged supply disruption after a Ukrainian drone strike last week.

Brent crude slipped below $64 a barrel, retreating after a more than 2% gain on Friday, while West Texas Intermediate dropped toward $59. The bearish momentum accelerated after two tankers were seen mooring at the port on Sunday—a clear signal that loadings had restarted. Reuters later confirmed that crude exports had resumed.

“The market had largely priced in a longer disruption,” said Mukesh Sahdev, founder and CEO of Xanalysts Pty. “The relatively quick restart sends a bearish signal and shows how sensitive oil remains to short-term logistical shifts.”

Last week’s attack on Novorossiysk—along with Iran’s seizure of an oil tanker near the Strait of Hormuz—had injected fresh geopolitical risk into the market. However, with global oil inventories rising and OPEC+ continuing to ramp up output, the underlying sentiment remains cautious. Steady import demand from China and India has provided a floor for prices, though U.S. sanctions on Russian energy continue to complicate trade flows.

The U.S. has escalated its sanctions regime in recent weeks, adding Rosneft PJSC and Lukoil PJSC to its blacklist in an effort to curb Moscow’s oil revenues. In a weekend statement, former President Donald Trump threw his support behind a Senate bill that would impose secondary sanctions on countries trading with Russia—a move that, if enacted, could further disrupt supply patterns.

Meanwhile, refining margins have surged globally as unplanned outages at plants in Asia and Africa, combined with permanent closures in Europe and the U.S., have tightened supplies of diesel and gasoline. Repeated Ukrainian drone strikes on Russian refineries have also reduced the country’s fuel output, adding another layer of volatility to energy markets.

Looking ahead, traders are weighing the competing forces of rising supply from key producers against persistent geopolitical risks and refining tightness. While the restart of Novorossiysk has eased immediate supply fears, the market remains vulnerable to further disruptions—particularly in the Middle East and Black Sea regions.

“We’re in a tricky equilibrium,” Sahdev added. “Any new supply shock could push prices higher quickly, but for now, the balance is tilting toward the bears.”