Oil prices rise after Ukraine attacks hit Russian energy sites

August 25, 2025

Oil prices edged higher on Monday as Ukraine stepped up attacks on Russia, raising fears of a Russian supply cut, while expectations of a U.S. rate cut added weight to global growth and energy demand.

Brent crude futures rose 6 cents, or 0.09%, to $67.79 a barrel, while WTI crude futures were up 9 cents, or 0.14%, at $63.75 at 0050 GMT.

Ukraine on Sunday launched a drone attack on Russia that knocked out the capacity of a major Russian nuclear power plant and sparked a fire at the Ust-Luga fuel export terminal, Russian officials said. Also, a fire at the Novoshakhtinsk refinery has been burning for four days, which was hit by a Ukrainian drone attack. The refinery mainly produces fuel for export and has an annual capacity of about 5 מיליון metric tons of oil, or about 100,000 barrels per day.

“Crude risks are now shifting to the top level due to Ukraine’s successful attacks on Russia’s oil infrastructure,” said Tony Sycamore, an analyst at IG Markets. At the same time, US Vice President JD Vance said on Sunday that Russia had made “significant concessions” toward a peaceful settlement with Ukraine, giving some hope to the situation.

On the other hand, President Donald Trump also reiterated a warning on Friday that he would impose sanctions on Russia if there is no progress toward a peaceful settlement in two weeks. Investors’ risk-taking stance has been maintained after Federal Reserve Chair Jerome Powell indicated that interest rate cuts are possible at the next meeting.

According to ANZ, this risk-oriented attitude has been helpful in increasing demand for commodities such as energy and metals, especially when supply chain issues are resurfacing.