Global oil markets saw a mild uptick on Thursday, with prices edging higher after Ukrainian attacks on Russian energy infrastructure renewed concerns about supply disruptions.
However, analysts noted that broader market fundamentals remain weak, keeping gains in check despite fresh geopolitical tensions.
Brent crude climbed 24 cents, or 0.38 per cent, to $62.91 a barrel in early trading today, while US West Texas Intermediate (WTI) gained 29 cents, or 0.49 per cent, to $59.24, reported Reuters. The modest rise followed a turbulent week dominated by conflicting signals, from tentative peace diplomacy to renewed military escalation in the Russia-Ukraine conflict.
The latest trigger for the price bounce came after Ukraine targeted the Druzhba pipeline in Russia’s Tambov region, marking the fifth attack on this major conduit that carries Russian crude to Hungary and Slovakia.
A Ukrainian military intelligence source confirmed the strike on Wednesday. Despite the attack, both the pipeline operator and Hungary’s state-owned oil and gas company reported that flows were continuing normally.
A Shift In Ukraine’s Drone Strategy
Commodity analysis firm Kpler said Kyiv appears to have recalibrated its strategy, focusing on repeated, targeted hits designed to disrupt Russia’s refining capacity.
“Ukraine’s drone campaign against Russian refining infrastructure has shifted into a more sustained and strategically coordinated phase,” Kpler said.
The repeated strikes have dented Russia’s refining throughput, which has averaged about 5 million barrels per day from September to November, representing a 335,000 bpd year‑on‑year decline. Gasoline output has suffered the most, while gasoil production has also weakened materially, the report noted.
Peace Talks Hit A Wall
Oil markets were also reacting to signs that peace negotiations are losing steam. Representatives of US President Donald Trump left discussions with the Kremlin without announcing any breakthrough on ending the conflict. Trump himself said it was unclear what the next steps would be, underscoring the fragile state of diplomatic efforts.
“Crude will likely remain stuck in a narrow range while the Ukraine peace efforts grind on,” said Vandana Hari, founder of Vanda Insights.
Earlier hopes for a ceasefire contributed to downward pressure on prices, with traders anticipating that a deal would eventually unwind sanctions and release more Russian oil into an already oversupplied market.
Even with renewed geopolitical risk, analysts warn that oversupply remains the dominant force shaping market direction. On Thursday, Fitch Ratings downgraded its oil price assumptions for 2025–2027, citing expectations that global output growth will continue to outpace demand.
Traders are also watching for fresh cues on global economic conditions, refining activity, and inventory levels. While the latest strikes add an element of uncertainty, the broader sentiment remains subdued.
