U.S. sanctions against Russian oil giants trigger sharp rise in oil prices
The United States’ recent policy decisions have once again significantly impacted the global energy markets, leading to a rapid surge in oil prices.
Following the announcement of sanctions against two major Russian oil companies — “Rosneft” and “Lukoil” — the global market responded immediately with a notable increase in oil prices.
This new move by the Trump administration marks a shift in U.S.
policy aimed at increasing pressure on Vladimir Putin’s government and encouraging diplomatic talks on ending the war in Ukraine.
Trading sessions saw West Texas Intermediate (WTI) prices jump by 2.5%, approaching $60 per barrel, while Brent crude stabilized at around $63.
The U.S.
Department of Treasury blacklisted both the state-owned “Rosneft” and the private “Lukoil,” reflecting a change from previous U.S.
policies that included plans for a meeting between Trump and Putin, which was later canceled.
Oil prices had fallen to their lowest levels in five months prior to the weekend but rebounded as analysts viewed the earlier decline as exaggerated.
A decrease in U.S.
crude inventories also eased concerns over excess supply.
Meanwhile, futures contracts for oil have continued a three-month trend of decline, driven by signs of a global supply glut.
Additionally, Trump announced plans to discuss with Chinese leader Xi Jinping during an upcoming summit in South Korea the potential purchase of Russian oil by China.
Furthermore, he was assured by Indian Prime Minister Narendra Modi that India would gradually reduce its oil imports from Russia.
China and India remain the largest consumers of Russian oil.
Simultaneously, the European Union is preparing to adopt a new set of sanctions against Russia, expected to be finalized early Thursday.
The package includes restrictions on 45 entities, including 12 companies from China and Hong Kong that assist Moscow in circumventing sanctions.
Notably, Russia’s main oil producers are “Rosneft,” led by Putin ally Igor Sechin, and “Lukoil,” which collectively account for nearly half of the country’s oil exports—approximately 2.2 million barrels daily.
Revenues from the oil and gas sector contribute around a quarter of Russia’s federal budget.