Rising Oil Prices After Trump's Statements on India's Stop of Purchasing Russian Crude

SadaNews - Oil prices have risen from their lowest levels in five months after U.S. President Donald Trump stated that Indian Prime Minister Narendra Modi pledged to stop his country's purchases of Russian oil, a move that could tighten global supplies.

Brent crude traded above $62 a barrel after dropping 2.2% during the previous two sessions, while West Texas Intermediate crude held steady near $59 a barrel. Trump did not provide a specific timeline for India to stop buying Russian oil, nor has there been any official confirmation from New Delhi yet.

India, along with its neighbor China, has been one of the biggest beneficiaries of substantial discounts on Russian oil available under the price cap mechanism established by the Group of Seven to keep supplies flowing while restricting Moscow's access to funds financing its war in Ukraine.

However, senior U.S. officials have accused Indian companies of making excessive profits from those purchases, which has been a major point of contention in trade talks that New Delhi seeks to accelerate with Washington. The Indian Trade Minister stated on Wednesday that the country is capable of purchasing an additional $15 billion worth of oil from the United States.

New British Sanctions and Increased Pressure on Moscow

In parallel, the United Kingdom imposed sanctions on the largest oil producers in Russia and on two Chinese energy companies, as well as the Indian refining company Nayara Energy, due to its dealings with Russian fuel.

This step is part of the West's effort to tighten the noose on the Russian energy sector to limit the flow of oil revenues to the Kremlin, undermining President Vladimir Putin's ability to finance the war in Ukraine.

Oil prices had fallen this month amid escalating trade tensions between the U.S. and China, raising concerns about demand in the world's largest oil consumers, and with global trading companies announcing that the long-expected surplus has started to materialize.

Trump stated that he believes the U.S. is in a trade war with China, even as Treasury Secretary Scott Pessin seeks to extend the delay in imposing high tariffs on Chinese goods in order to resolve the dispute concerning critical minerals.

Meanwhile, an industry report showed that U.S. oil inventories rose by 7.4 million barrels last week, which could be the largest increase since July if confirmed by the official data expected to be released later on Thursday.