Russian drone strikes on Allseeds oil extraction plant in Ukraine led to a rise in Russian sunflower oil prices

On the morning of December 20, Russian drones attacked Ukraine’s largest oil transshipment terminal, Allseeds, in the port of Pivdennyi , killing one employee and injuring two others, as well as losing thousands of tons of sunflower oil and damaging the plant’s infrastructure. The Russian occupiers’ attacks on Turkish oil tankers sailing from Ukrainian ports and the strikes on the port infrastructure of Black Sea ports have virtually paralyzed seaborne exports from Ukraine and led to a much-needed increase in the price of Russian sunflower oil, which has also supported palm oil prices, which are under pressure from rising inventories.

Offer prices for Russian sunflower oil (delivered in January) increased by $40-50/t to $1,240-1,250/t FOB, although demand prices for sunflower oil delivered to India remained unchanged during the week at $1,320-1,325/t CIF Mumbai.

Vegetable oil prices in India are under pressure from rising soybean and palm oil supplies and a weakening Indian rupee. In addition, according to importers, a shipment of 100,000 tonnes of soybean oil has been cancelled or postponed due to a sharp increase in domestic soybean oil supply in the country.

January soybean oil futures on SWOT fell 2% to $1,065/t for the week and are trading 4.6% lower than a month ago, amid uncertainty over U.S. biofuel production and lower soybean prices.

The price of soybean oil in Brazil decreased by $10/t to $1,085-1,090/t FOB in a week, and in China – by another $20-30/t to $1,130-1,140/t.

January palm oil futures on Bursa Malaysia rose 1.8% to 4,035 ringgit/t or $995/t for the week, receiving speculative support from a possible reduction in exports from the Black Sea region and a recovery in oil prices, but fundamental factors behind the increase in palm oil supply will continue to hold prices back.

According to surveyors at AmSpec Agri Malaysia, Malaysian palm oil exports fell 0.87% month-on-month between December 1 and 20, confirming weak demand from importers.

According to the Indonesian Biofuel Producers Association (APROBI), the Indonesian government has set a biodiesel production quota of 15.646 million kiloliters for 2026, which is practically in line with the 2025 figure and indicates that the current B40 mandate (using 40% palm oil in biofuels) is likely to remain unchanged. This will lead to an increase in the supply of palm oil from Indonesia and increase pressure on prices. The B50 program was expected to allow an additional 3.5-4 million tons of palm oil to be processed in Indonesia.

The US military’s blockade of Venezuelan oil exports has led to a speculative rise in oil prices. For example, February Brent crude futures rose 5.8% to $62.4/barrel this week, reversing the previous week’s decline. However, it should be noted that Russian Urals oil prices remain low at $35-38/barrel due to sanctions pressure, which will restrain the rise in global oil prices.