Oil edges lower as Russian flows halted via key pipe to Europe
BNN Bloomberg
Oil futures ended slightly lower Tuesday, reversing earlier gains, on indications that Russian crude shipments via the southern leg of a major pipeline to Europe may resume in a few days after being suspended.
Benchmarks Brent and West Texas Intermediate crude slipped after swinging about 2 per cent in each direction earlier in the session. Russia’s Transneft said Ukraine halted flows through its Druzhba pipeline toward Hungary, the Czech Republic and Slovakia on Aug. 4 as sanctions blocked payment of Moscow’s transit fee. That section of the network usually carries about 250,000 barrels a day, Transneft data show.
Prices reversed gains in part after Czech state-owned oil pipeline operator Mero said crude supplies via the southern portion of the link should resume “within several days.”
“Energy traders faded the rally that stemmed from the halting of oil shipments because it wasn’t triggered by an escalation from the Russians,” said Ed Moya, senior market analyst at Oanda Corp. Europe is going to figure out how to allow the payments that were behind that disruption, he added.
