Oil rallies as Russian flows halted via key pipeline to Europe
BNN Bloomberg
Oil reversed an earlier decline as Russian shipments via the southern leg of a major pipeline to Europe were suspended.
Brent futures rose as much as 1.8 per cent to trade near US$98 a barrel, after earlier dropping by the same amount. US crude futures climbed as much as 2.1%. Russian network operator Transneft said Ukraine halted flows through the 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 link usually carries about 250,000 barrels a day, Transneft data show.
Futures have been volatile in recent days amid thin summer trading volumes. The disruption to Russian oil supplies is a reminder of the risks to production in a market that’s been grappling with scant spare capacity. Yet prices also fell to the lowest since February last week on global economic growth concerns. Weakness in equity markets also limited oil’s gains.
