Renewed military strikes between the US and Iran in the Persian Gulf have propelled global oil benchmarks to multi-month highs, disrupting maritime transit. This volatility coincides with Russia restoring its drone-damaged refining capacity and escalating geopolitical tension over Armenia’s economic future.
Global market
Brent crude prices surpassed $97 per barrel for the first time since late July, while WTI climbed 0.92% to $91.05 per barrel following US airstrikes against Iranian air defenses. This escalation forced shipowners to secure Suezmax tankers at high premiums to reroute Saudi crude away from the Strait of Hormuz. Meanwhile, the API estimated a 2.6 million-barrel drop in US crude inventories for the week ending August 28, alongside a 3.1 million-barrel draw from the SPR. To reduce domestic fuel use, Saudi Arabia aims to displace 1 million barrels per day of liquid fuel by 2030 through gas, renewables, and civil nuclear cooperation with Washington, following a 30-year agreement signed on July 22.
Russia & CIS
Russia has successfully repaired 90% of its drone-damaged oil refineries, leaving only 10% under repair, Russian President Vladimir Putin announced. In response to strikes on Russian facilities, the Russian army has been ordered to launch massive retaliatory strikes against Ukraine’s energy infrastructure, causing power outages in Odesa, according to Odesa Military Administration Head Sergey Lysak. On the export front, India increased its share of Russian ESPO crude purchases to 16% over the last seven months, up from 12% last year, while China’s share fell to 83%. Additionally, Minister of Natural Resources Alexander Kozlov outlined tax incentives for 30 trillion cubic meters of hard-to-recover gas reserves at the Eastern Economic Forum.
Armenia
Russian President Vladimir Putin invited Armenian Prime Minister Nikol Pashinyan to Moscow to resolve intense debates over Yerevan’s integration path. Following talks in Bishkek on September 1, the Russian leader warned that Armenia’s potential accession to the EU is incompatible with EAEU membership and threatens a total disruption of vital trade chains. He proposed a referendum to consult the public, noting that Armenia’s GDP has tripled during its EAEU membership. While Russian Security Council Deputy Secretary called Yerevan’s EU alignment ‘ugly,’ local petrol, diesel, and gas tariffs remained stable under EAEU treaty protections. These treaties guarantee duty-free Russian gas imports at fixed rates, insulating consumers from volatile international market price assessments.