Oil jumps 5% as Caspian pipeline disruption adds to supply fears | Reuters

Oil jumps 5% as Caspian pipeline disruption adds to supply fears | Reuters

Oil prices jumped 5% to over $121 a barrel on Wednesday as disruptions to Russian and Kazakh crude exports via the Caspian Pipeline Consortium (CPC) pipeline added to worries over tight global supplies.

The situation adds to market worries about the ripple effect of heavy sanctions on Russia, the world's second-largest crude exporter, after its invasion of Ukraine.

The CPC pipeline is a significant supply line for global markets, carrying around 1.2 million barrels per day of Kazakhstan's main crude grade, or 1.2% of global demand.

Brent crude futures settled up $6.12, or 5.3%, to $121.60, while U.S. West Texas Intermediate (WTI) crude futures rose $5.66, or 5.2%, to $114.93 a barrel.

Oil benchmarks have been steadily rallying since Russia invaded Ukraine a month ago in what it calls a "special operation" and United States and its allies slapped heavy sanctions on that nation, disrupting worldwide oil trade.