Black Sea shipping attacks escalate

What happened: Turkey has restricted Black Sea traffic due to a surge in Russian and Ukrainian attacks on civilian vessels, with over 80 vessels targeted in July alone. India summoned the Russian envoy after a mass casualty tanker strike, while Kazakhstan is rerouting oil exports due to threats. The conflict has escalated, with a kamikaze drone strike killing three on a Russian beach.

Market impact: The escalating conflict disrupts global supply chains, impacting energy and commodity exports. Companies like KazMunayGas and Russian oil producers face operational risks. Shipping companies, such as those using the Bosphorus Strait, may face higher insurance costs and route diversions. The Black Sea grain export deal is at risk, affecting global food prices.

What to watch next: The evolution of the Russia-Ukraine conflict, particularly any escalation or de-escalation in attacks on civilian vessels and ports. The sustainability of the Black Sea grain export deal, with the next review scheduled for August 17. The potential impact of the conflict on global energy and commodity prices, with key economic data releases due in the coming weeks.