Kazakhstan experienced uncertainty about oil exports through a Russian terminal on the Black Sea. New Russian rules temporarily stopped foreign oil tankers from loading at Russian ports, impacting Kazakh exports. Originally, the loading plan aimed for 1.66 million barrels per day. However, after getting the necessary approvals from the Russian intelligence service, loading operations resumed.

Prior Delays

Earlier, there were delays at Turkey’s Ceyhan port because of contamination checks on oil from Azerbaijan and Kazakhstan. Exports for July and August were expected to reach 17.3 million barrels, averaging 560,000 barrels each day. The delays affected five oil tankers, but loading started again as scheduled on Wednesday. These disruptions likely played a role in the Brent oil price dropping to about $70. With exports returning to normal, price movements might adjust as well. The recent price increase seems to have come from temporary supply disruptions at the Black Sea terminal. As exports from Kazakhstan normalize, the price premium caused by these concerns is likely to decrease. Traders should prepare for possible price corrections or stabilization as the plan of 1.66 million barrels per day resumes.

Current Market Conditions

Currently, Brent crude is trading higher, around $82 per barrel, but this rise is no longer tied to the short-term Kazakh supply issues. Recent data from the Energy Information Administration indicated a U.S. crude inventory drop of 4.2 million barrels, pointing to tighter supply and demand. This trend helps support prices, even as the premium from the port incident lessens. The overall market is also backed by OPEC+ maintaining strict production levels, recently deciding to extend significant output cuts into 2025. Their efforts to control supply make it difficult for anyone betting on major price drops. While the normalization of exports from the Russian port reduces bullish influences, it does not change this larger supportive trend. Historically, price spikes from temporary logistical issues, like storm damage at the same terminal in previous years, tend to be short-lived. Traders may want to adopt strategies that profit from declining volatility as the market adjusts to renewed normal operations. One option could be selling out-of-the-money call options to take advantage of the easing of immediate supply concerns. Create your live VT Markets account and start trading now.

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