Military strikes against oil tankers in the Strait of Hormuz and a massive drone attack on a major Russian Baltic terminal have escalated global fuel anxieties. These supply disruptions have pushed European LNG prices higher while Russia faces a record surge in domestic wholesale petrol costs.
Global market
Two oil supertankers, the Sidr and the Senegal Prosperity, were hit by unknown projectiles in the Strait of Hormuz, threatening the tentative recovery of Persian Gulf crude flows on Tuesday. The Sidr is operated by Saudi Arabia’s state shipping giant, Bahri. Amid these flaring tensions, Rotterdam’s LNG bunker price climbed by $67 per tonne to $1,346 per tonne, tracking front-month Dutch TTF natural gas contract gains to $23.63 per million British thermal units. Meanwhile, in a major renewable energy milestone, solar power has overtaken coal as China’s largest electricity capacity source, reaching 1,286 gigawatts (31.5% of total installed capacity) at the end of July.
Russia & CIS
A massive Ukrainian drone attack ignited a fire at Russia’s Ust-Luga oil export terminal in the Baltic Sea, where Russian air defenses shot down 52 drones overnight, according to Leningrad Governor Alexander Drozdenko. This maritime supply shock coincides with severe domestic fuel pressures, as the wholesale price of AI-92 petrol hit a record 75,477 rubles per tonne on the Saint Petersburg exchange, surging 4.36% on Tuesday. To stabilize retail costs, Crimean Prime Minister Yury Gotsanyuk announced daily sales of price-capped AI-95 petrol at under 100 rubles per litre. Central Bank advisor Kirill Tremasov stated that the domestic fuel market should become more predictable by the October board meeting.
Armenia
A damaged gas pipeline has completely cut off natural gas supplies to several districts of Yerevan, according to Armenian news outlet News.am. The utility disruption occurred on Tuesday morning, September 1, leaving consumers in several administrative areas of the capital without gas. While local supply was disrupted, retail prices for petrol, diesel, and compressed natural gas at local filling stations remained stable. Armenia’s energy security continues to be anchored by its integration into the EAEU. Strategic bilateral agreements with Moscow secure uninterrupted, duty-free imports of Russian natural gas and petroleum products at long-term fixed rates, shielding consumers from volatile price fluctuations in international market price assessments.