DTN Oil

WASHINGTON (DTN) -- Oil futures nearest delivery on the New York Mercantile Exchange and Brent crude traded on the Intercontinental Exchange settled higher for the fourth consecutive session Thursday, finding strong buying support from political unrest in non-OPEC+'s second largest producer, Kazakhstan, where antigovernment protests halted operations at the nation's key oil fields along with supply disruptions in a number of Africa's oil producing nations that undermine the ability of OPEC+ to raise supply quotas.

Kazakhstan's antigovernment protests that were sparked by soaring fuel prices reached the nation's largest oil field, Tengiz, on Thursday, affecting nearly 800,000 barrels per day (bpd) in daily crude oil production. Contractors disrupted train lines and halted operations in support of protests taking place across the central Asian country. Dozens of people were killed Thursday at the capital, Almaty, and Russia's President Vladimir Putin sent military troops to quell protests that turned violent overnight. The situation in Kazakhstan is becoming increasingly tense. The country produces around 1.6 million bpd and was called out at this week's OPEC+ meeting for low compliance with output quotas. For February, the quota for Kazakhstan is 1.589 million bpd, per the group's decision.

Further supporting the oil complex, a Bloomberg survey published Thursday morning found OPEC added only 90,000 bpd in new production in December against a quota to increase output by 250,000 bpd last month, which the cartel is entitled to under their deal with Russia-led producers. The output has been severely limited by Africa's largest producers Nigeria and Angola, that combined underproduced to a tune of 250,000 bpd in recent months.

Furthermore, Libya's crude production declined sharply at the start of a new year, with over 300,000 bpd from the country's largest oil field at Sharara shut-in by an insurgency and another 200,000 bpd shut-in over the weekend due to a leaking pipeline that carries crude to the nation's crude oil terminal El Sider. Combined, these closures have reduced Libyan oil production to about 700,000 bpd -- the lowest in more than a year.

Also on Thursday, TC Energy said it has resumed operations at its 590,000 bpd Keystone oil pipeline following two days of unplanned maintenance amid frigid temperatures affecting western Canada. Temperatures in Alberta plunged to minus 31 degrees Fahrenheit Wednesday night. Most of Alberta is under an extreme cold warning that is expected to last until the weekend. The company said the unplanned maintenance on Keystone began at around 8 p.m. EST on Tuesday.

Canadian heavy crude prices tightened as traders anticipated oil sands production issues relating to the cold snap. On Wednesday, Western Canada Select heavy blend crude narrowed its discount to WTI futures to $12.10 barrel (bbl).

On the session, front-month West Texas Intermediate futures rallied $1.61 to $79.46 bbl settlement -- a fresh 6 1/2-week high. International crude benchmark Brent for March delivery advanced $1.19 to $81.99 bbl. NYMEX February RBOB futures surged 1.22 cents to $2.3043 gallon, with the front-month ULSD contract gaining to $2.4777 gallon, up more than 3 cents on the session.

Liubov Georges can be reached at liubov.georges@dtn.com