Oil Prices Decline as Investors Await Signals on Russian Supplies

Sada News - Oil prices have fallen after four days of gains, as investors await clearer signals regarding supplies, while also monitoring the broader market implications following U.S. President Donald Trump's dismissal of a Federal Reserve board member.

Brent crude dropped towards $68 a barrel, while West Texas Intermediate was trading near $64.

The Department of Homeland Security issued a draft notice on Monday to double tariffs on all Indian imports, punishing the country for its purchases of Russian crude, with implementation set to begin on Wednesday. This move is part of a broader effort to reach a peace agreement between Russia and Ukraine.

On a wider scale, stocks and high-risk assets declined after Trump's dismissal of Federal Reserve member Lisa Cook, raising concerns about the independence of the central bank, at a time when data indicates a slowdown in the economy, including the labor market. In the long term, this could negatively impact energy consumption.

The Market Assesses the Impact of Tariffs

Oil has moved within a narrow range for most of August, as traders assess the impact of U.S. tariffs, as well as the effects of a series of supply increases from OPEC+. The International Energy Agency warned earlier this month that the global oil market is heading towards a record surplus next year, with demand growth slowing and supplies inflating.

Robert Rennie, head of commodity and carbon research at Westpac Banking Corp, stated: "If we proceed with doubling tariffs on India, the market will once again question Russian flows, and we may see prices retest levels close to $70 in the near term."

He added that the market is also focused on a series of recent Ukrainian attacks on Russian energy infrastructure.

Regarding the tariff plans, Trump also indicated that he might impose additional tariffs on Russia's trading partners or sanctions targeting Moscow if no progress is made on the agreement, warning of "very significant consequences" if nothing happens in the coming weeks. The Indian government has described the so-called secondary tariffs as unfair.