Oil prices jumped after the United States announced the imposition of sanctions on Russia’s biggest oil producer, while US President Donald Trump stepped up pressure on his counterpart, Vladimir Putin, to negotiate an end to the war in Ukraine. Brent crude rose 2.9% to more than $64 a barrel, and West Texas Intermediate crude also rose after the United States blacklisted companies Rosneft and Lukoil, signaling Moscow’s lack of commitment to completing the peace process in Ukraine. Trump also seeks to exert pressure on the main buyers of Russian oil, namely India and China. These sanctions represent a shift in position for Trump, who announced last week that he would meet Putin in the coming weeks and repeatedly said he believed Russia wanted to end the war, before declaring on Tuesday that he did not want a futile meeting. Trump discusses China and India’s purchases of Russian oil After the sanctions were announced, Trump said he planned to speak with Chinese President Xi Jinping about China’s purchases of Russian oil during a meeting scheduled in South Korea next week. He added that Indian Prime Minister Narendra Modi had informed him on Tuesday that his country would start reducing its purchases of Russian oil. According to Bloomberg, China and India have become the biggest buyers of Russian oil since the outbreak of the war in Ukraine, after other countries avoided dealing with Moscow because of the war. Also Read: Trump: India will reduce its purchases of Russian oil. Trump has imposed stiff tariffs on India over trade with Russia, while excluding China from any similar measures. Rosneft, led by Igor Sechin, a close associate of Putin, and privately held Lukoil are the two largest oil producing companies in Russia, together accounting for nearly half of the country’s total exports, or about 2.2 million barrels per day in the first half of this year, according to Bloomberg estimates. Taxes levied on the oil and gas sectors make up about a quarter of the Russian federal budget. The European Union reaches a new package of sanctions against Moscow. In a separate context, countries of the European Union reached an agreement on a new package of sanctions against Russia, which is scheduled to be adopted on Thursday. The measures will target 45 entities that helped the OPEC+ member state evade sanctions, including 12 companies in China and Hong Kong, according to a statement issued by Denmark, which holds the rotating presidency of the European Union. Oil prices rebounded from a five-month low hit on Monday amid indications that the recent wave of selling was overdone, while a decline in US oil inventories helped ease fears of a supply glut. However, futures remain on track for a third monthly loss as indicators of a possible global oversupply continue to weigh on prices.
Oil prices jump after US sanctions against Russia’s biggest producer
