Oil prices are rising sharply on Friday morning on news of Israeli strikes on Iran.
The price of August Brent futures on the London ICE Futures exchange rose by $5.8 (8.36%) to $75.16 per barrel as of 8:11 a.m. On Thursday, these contracts fell by $0.41 (0.59%) to $69.36 per barrel.
WTI crude oil futures for July delivery on the New York Mercantile Exchange (NYMEX) rose by $5.91 (8.69%) to $73.95 per barrel. At the end of Thursday’s session, the value of these contracts decreased by $0.11 (0.16%) to $68.04 per barrel.
The Israeli Air Force launched dozens of strikes on nuclear and missile sites in Iran on Thursday, according to the Axios portal.
“Israeli Defense Minister Israel Katz announced a state of emergency throughout the country and said: ‘Following the State of Israel’s preemptive strike against Iran, a missile attack and drone attack against the State of Israel and its civilian population is expected in the near future,’” the portal reported.
A representative of the Israel Defense Forces (IDF) told reporters that the operation to destroy Iran’s nuclear capabilities and ballistic missile capabilities would last several days.
The official explained that in recent weeks, “signs have emerged” that Iran is seeking to build a nuclear bomb.
“We are now in a strategically advantageous position and close to the point of no return, and we had no choice but to take action,” he said.
The prospect of an escalating conflict in the Middle East threatens shipping in the Strait of Hormuz, a key route for about 20% of global oil supplies, according to Trading Economics.
The State Oil Company of Azerbaijan (SOCAR) produced 7 million 485.59 thousand tons of oil in 2024, according to the company’s report on last year’s results.
As reported, SOCAR produced 7 million 736.202 thousand tons of oil in 2023. Thus, last year, the figure decreased by 3.2%.
According to the data, gas production in 2024 amounted to 7 billion 718.053 million cubic meters, compared to 8 billion 390.738 million cubic meters a year earlier. Thus, DNAOC reduced gas production by 8% last year.
The company also notes that last year, gas consumption in Azerbaijan amounted to 13 billion 666.353 million cubic meters, which is 1.7% more than in 2023.
Earlier, the republic’s Ministry of Energy, citing operational data, reported that in 2024, the State Oil Company of Azerbaijan produced 7.5 million tons of oil with condensate at its own fields, which is 3.8% less than in 2023, as well as 7.7 billion cubic meters of gas, which is 8.3% lower than the previous year.
Oil prices remained in the red on Wednesday after the publication of the US Department of Energy’s weekly report on energy reserves in the country.
Commercial oil inventories in the US last week increased by 3.46 million barrels to 415.13 million barrels, the Energy Department reported. Gasoline stocks increased by 2.96 million barrels, distillate stocks decreased by 4.99 million barrels.
The cost of March futures for Brent on the London ICE Futures exchange as of 18:00 hours is $77.3 per barrel, which is $0.19 (0.25%) lower than at the close of the previous trading.
March futures for WTI during trading on the New York Mercantile Exchange (NYMEX) decreased in price by $0.36 (0.49%) to $73.41 per barrel.
Traders’ attention is still focused on the actions of US President Donald Trump, who intends to impose a 25 percent duty on imports from Canada, a major supplier of oil to the US market, starting February 1.
“The oil market continues to dance to the rhythm of Trump’s tariff orchestra, with the focus on the duties for Canada that will take effect this Saturday,” said Ole Hansen, who is responsible for commodity strategy at Saxo Bank.
Traders are also waiting for news from OPEC+. Kazakhstan’s Energy Minister Almasadam Satkaliyev said on Wednesday that a meeting at the level of OPEC+ representatives is planned in the near future to discuss, among other things, the US plans to increase oil production.
Ukrnafta PJSC produced 1.170 billion cubic meters of gas in 2024, which is 6.5% more than in 2023 (1.097 billion cubic meters) and 1.418 million tons of oil, which is 0.6% more than in the previous year (1.410 million tons). According to the company’s press release on Thursday, production growth in oil equivalent in 2024 amounted to an additional 70.5 thousand tons of hydrocarbons, or 3%: 2.42 million tons against 2.35 million tons in 2023.
“Despite prolonged power outages that limited mechanized oil production, the company managed not only to compensate for the natural decline but also to ensure an increase in oil and gas volumes,” said Sergiy Koretsky, Ukrnafta’s CEO, as quoted in the press release. He added that the company has been improving its production figures for the second year in a row.
According to the company, in 2025, Ukrnafta will continue to drill new wells, upgrade equipment, replacing Soviet equipment with modern and technological equipment from world leaders, and intensify production.
“Ukrnafta is Ukraine’s largest oil producer and operator of the national network of gas stations. In March 2024, the company took over the management of Glusco assets and operates 547 filling stations – 462 owned and 85 managed.
The company is implementing a comprehensive program to restore operations and update the format of its filling stations. Since February 2023, the company has been issuing its own fuel coupons and NAFTAKarta cards, which are sold to legal entities and individuals through Ukrnafta-Postach LLC.
“Ukrnafta holds 92 special permits for commercial development of fields. It has 1832 oil and 154 gas production wells on its balance sheet.
Ukrnafta’s largest shareholder is Naftogaz of Ukraine with a 50%+1 share.
In November 2022, the Supreme Commander-in-Chief of the Armed Forces of Ukraine decided to transfer to the state a share of corporate rights of the company owned by private owners, which is currently managed by the Ministry of Defense.
In 2024, Ukraine transported about 11.36 million tons of Russian oil through the southern branch of the Druzhba pipeline, reducing transit by 16% compared to last year.
“This is the lowest value at least since 2014, and probably in the entire history of Ukraine’s independence since 1991,” former Energy Minister Olha Buslavets posted on Facebook late last week.
According to her, most of the Russian oil in 2024 was supplied to Hungary – more than 4.7 million tons, which is almost the same as in 2023. In addition, 3.9 million tons of oil were transported to Slovakia (-15%) and 2.7 million tons (-35%) to the Czech Republic.
As reported, in July 2024, Ukraine tightened sanctions against Russia’s LUKOIL, effectively banning the transit of oil to Central Europe through the Ukrainian section of the Druzhba pipeline. The company was a major supplier of raw materials to both Hungary (about a third of the country’s imports) and Slovakia (40-45%).
At the same time, in September, the Hungarian MOL Group announced an agreement with Russian oil suppliers and pipeline operators to ensure its transportation via the Druzhba pipeline through Belarus and Ukraine to Hungary and Slovakia. According to MOL Group, the company has taken over ownership of the relevant volumes of crude oil on the border of Belarus and Ukraine.
Also in September, EC spokesman Olof Gill said that after Ukraine banned LUKOIL’s oil transit to Hungary and Slovakia, the European Commission (EC) quickly took all necessary steps to resolve the issue. He noted that LUKOIL is not the only oil supplier to Hungary and Slovakia.
Oil prices rose in pre-holiday trading on Tuesday, recovering the losses incurred the day before.
The cost of February futures for Brent on the London ICE Futures exchange rose by $0.95 (1.3%) to $73.58 per barrel.
February futures for WTI on the New York Mercantile Exchange (NYMEX) rose by $0.86 (1.2%) to $70.1 per barrel.
Media reports that China may issue special treasury bonds worth a record 3 trillion yuan ($411 billion) in 2025 to raise funds to support the national economy have encouraged oil traders. China is one of the world’s largest oil importers and consumers.
Quotes continue to be supported by concerns about geopolitical tensions in Eastern Europe and the Middle East, as well as the prospect of tighter sanctions against Russia and Iran.
Meanwhile, expectations of an oversupply of crude oil amid unclear demand prospects and a stronger US dollar are having a restraining effect on oil prices, making commodities less attractive.
The market was evaluating the latest statements by US President-elect Donald Trump, who threatened to restore Washington’s control over the Panama Canal if the fee for passage through it is not reduced, and was also waiting for official data on commercial oil reserves in the US, which will be published this week with a delay due to the holidays.
“We can assume that WTI will trade around the $70 mark until Friday, when the late weekly report from the Energy Information Administration is released, which will set additional price targets,” Ritterbusch said in a research note.
On Wednesday, exchanges in the US, UK, Germany, France and other European countries, as well as Hong Kong, South Korea and Australia, are closed for Christmas. Many sites will remain closed on Thursday.
