Investors assess the impact of drone strikes on Russian refineries and export terminals affecting shipments

Oil prices remained largely stable on Monday as investors assessed the impact of Ukrainian drone strikes on crucial Russian refineries and export terminals, which could jeopardize crude and fuel shipments. Brent crude futures increased by 34 cents to $67.33 per barrel, while U.S. West Texas Intermediate crude rose by 9 cents to $62.78 per barrel. Both benchmarks had seen gains of over one percent in the previous week, following Kyiv’s intensified targeting of Russian oil infrastructure.

Among the facilities attacked were the Primorsk terminal, Russia’s largest oil export hub, capable of loading approximately 1 million barrels per day, and the Kirishinefteorgsintez refinery, one of the country’s two largest, processing around 355,000 barrels daily—equating to 6.4 percent of national refining capacity. Ukrainian drone command confirmed “successful strikes” on these sites. Despite the damage, a Russian oil company in Bashkortostan announced it would continue to maintain its current production levels following a recent drone attack.

U.S. President Donald Trump reiterated willingness to impose sanctions on Russia unless Europe acts in tandem to curb oil imports from Moscow. “Europe buys oil from Russia. I don’t want them to buy oil,” Trump stated, pressing European nations for a unified response. These remarks come as diplomatic and economic tensions continue to affect global commodity markets.

Meanwhile, investors are closely monitoring ongoing U.S.-China trade negotiations in Madrid, which started on Sunday. U.S. demands include urging allies to impose tariffs on Chinese imports, motivated partly by Beijing’s purchases of Russian crude oil. The talks aim to address a broad trade dispute including issues such as TikTok access and tariff levels, with the hope of reducing escalating trade tensions.

U.S. economic concerns and Fed outlook

Adding to market uncertainty are recent U.S. economic indicators showing weaker job creation and heightened inflation, raising questions about the sustainability of fuel demand growth in the world’s top oil-consuming country. The Federal Reserve is widely expected to cut interest rates by a quarter point during its September 16-17 meeting—the first cut of 2025—as economists anticipate further reductions later in the year to support a slowing labor market while balancing inflation risks.

Federal Reserve Chair Jerome Powell has indicated potential easing of monetary policy amid concerns that economic growth may slow. Investors are watching the Fed’s decisions closely, as they could influence oil demand expectations and the global economic outlook.

Read more: Crude oil prices fall to $65.86 on stronger supply expectations, U.S. demand concerns

Steady demand growth

Additionally, the International Energy Agency (IEA) reported on Monday that global oil demand is expected to grow steadily in the final quarter of 2025, driven by recovering industrial activity in major economies and easing COVID-19 restrictions in parts of Asia. The IEA forecast raised prices modestly in Asia for refined products, particularly diesel and gasoline, as regional inventories declined. This demand outlook counterbalances supply concerns from the ongoing geopolitical tensions in Eastern Europe.

Furthermore, Saudi Arabia reaffirmed its commitment to supply cuts under the OPEC+ agreement to support prices amid uncertainty, according to a statement released by the Saudi Ministry of Energy. This stance is seen as a pivotal factor sustaining Brent crude benchmarks near the $67 level despite global economic headwinds.

Market analysts also cited ongoing discussions about potential EU sanctions targeting Russian oil imports post-2025 as a factor influencing market sentiment. The EU’s recent announcement emphasized increasing efforts to reduce dependency on Russian energy supplies, which could tighten global supply and support oil prices even as demand growth remains moderate.