Oil prices declined on Monday, erasing last week’s gains, after loadings resumed at Russia’s key Novorossiysk export hub. Operations at the Black Sea port had been suspended for two days following a Ukrainian attack.

Brent crude futures fell 53 cents, or 0.82%, to $63.86 a barrel at 0423 GMT, while U.S. West Texas Intermediate (WTI) crude dropped 56 cents, or 0.93%, to $59.53.

Both benchmarks had climbed more than 2% on Friday, ending the week slightly higher after export suspensions at Novorossiysk and a nearby Caspian Pipeline Consortium terminal temporarily disrupted about 2% of global supply.

Supply Resumes, But Attacks Continue

Novorossiysk port restarted loadings on Sunday, according to industry sources and LSEG data. Still, markets remain alert as Ukraine intensifies attacks on Russian oil infrastructure.

Ukraine’s military said it struck Russia’s Ryazan refinery on Saturday, followed by an attack on the Novokuibyshevsk refinery in the Samara region on Sunday.

“Markets are trying to assess the long-term impact of Ukraine’s strikes on Russia’s crude exports, while some traders are also taking profits after Friday’s rally,” said Toshitaka Tazawa of Fujitomi Securities. He added that oversupply concerns persist due to rising OPEC+ output, with WTI expected to hover near $60, within a $5 trading range.

Sanctions and Production Outlook

Investors are also tracking the impact of Western sanctions on Russian supply. The United States has banned transactions with Russian oil majors Lukoil and Rosneft from November 21 in an effort to pressure Moscow into peace negotiations. President Donald Trump said Republicans are preparing legislation to sanction any country doing business with Russia, with Iran potentially being added to the list.

Earlier this month, OPEC+ confirmed a 137,000 barrels per day increase in December output targets—unchanged from October and November—and agreed to pause further hikes in Q1 next year.

ING noted the oil market is likely to remain in large surplus through 2026, but warned that supply risks are rising due to escalating Ukrainian drone strikes and Iran's recent seizure of a tanker near the Strait of Hormuz, a vital route for nearly 20 million barrels per day of oil.

Market Positioning and U.S. Production

Speculators increased net long positions in ICE Brent by 12,636 lots to 164,867 lots last week, driven largely by short-covering amid heightened geopolitical risk.

Meanwhile, U.S. oil drilling activity inched higher. The number of active oil rigs rose by three to 417 in the week to November 14, according to Baker Hughes.