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FinanceRussia's largest Black Sea oil export terminal Sheskharis offline since July 21 after drone attacks
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Russia's largest Black Sea oil export terminal, Sheskharis at Novorossiysk, has gone offline since July 21 following drone attacks that also shut down the neighboring Caspian Pipeline Consortium (CPC) terminal. Sheskharis exported about 650,000 barrels per day in the first half of the year. The disruptions have forced Kazakhstan to cut oil production, with Chevron's Tengiz field output halved due to storage constraints. Ukraine has expanded drone strikes to target commercial shipping and export infrastructure in the Black Sea and Sea of Azov. Russia warned vessels that navigation is unsafe due to drone threats. The outages compound global supply pressures from Strait of Hormuz and Red Sea disruptions, pushing Brent crude above $100. Strategic reserves and commercial stocks are depleted, and refining margins remain high as diesel supplies tighten.
Source report
Russia's largest Black Sea oil export terminal has effectively gone offline, just days after drone attacks shut down the neighbouring Caspian Pipeline Consortium (CPC) terminal. The disruption tightens another key artery that moves crude onto the global market.
The Sheskharis terminal at Novorossiysk has not loaded a crude tanker since July 21, according to Bloomberg.
Key Facts
- Sheskharis exports: Averaged approximately 650,000 barrels per day during the first half of the year.
- CPC terminal: Normally handles more than 80% of Kazakhstan's crude exports and roughly 2% of global oil supply.
- Proximity: The two terminals sit only a few miles apart, forming one of the most important oil export hubs on the Black Sea.
Upstream Impact
The disruption is already affecting production upstream:
- Kazakhstan cut oil production this week after CPC suspended tanker loadings.
- Output at Chevron's giant Tengiz field reportedly fell by more than half as storage filled and producers were forced to reduce pipeline flows.
- If Sheskharis remains idle, another major export outlet disappears from an already stressed market.
Escalating Drone Campaign
Ukraine has expanded drone attacks beyond refineries and storage facilities to include:
- Commercial shipping
- Export infrastructure in the Black Sea and Sea of Azov
Russia has responded by warning vessels operating in its Black Sea economic zone that navigation is no longer considered safe due to the threat from air and sea drones.
Market Context
The market is running out of places to absorb supply disruptions:
- Brent crude climbed above $100 this week as renewed fighting around the Strait of Hormuz and Houthi attacks in the Red Sea threatened Gulf exports.
- The Black Sea is now becoming another source of lost barrels instead of replacement supply.
- Inventories are no longer providing much of a cushion: strategic reserves have been drawn down for months, commercial stocks have fallen sharply, and refining margins remain elevated as diesel supplies tighten.
The oil market entered the summer worried about oversupply. It is ending July watching another export terminal fall silent.
By Julianne Geiger for Oilprice.com
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Source
OilPrice.com Daily News UpdateWestern
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Russia's Black Sea Oil Export Hub Disrupted by Drone Attacks