Oil poised for biggest weekly gain since June after US sanctions on Russia
Oil is poised for its biggest weekly gain since June after U.S. sanctions on major Russian producers disrupted the market, raising concerns about supply and boosting demand for alternative crude grades.
Brent crude traded near $66 a barrel on Friday, up roughly 7% for the week, while West Texas Intermediate (WTI) hovered below $62, News.Az reports, citing Bloomberg.
The sanctions are expected to sharply reduce Russian crude exports to key buyer India, while some Chinese state-owned refiners have paused purchases.
The U.S. measures come amid swelling global supply, with Russia experienced in evading sanctions. Kuwait’s oil minister noted that OPEC stands ready to increase production if needed, warning of the potential for higher prices. Chinese majors are reassessing purchases of Russian crude, mainly the ESPO grade, as President Donald Trump prepares to discuss China-Russia oil trade with Xi Jinping next week.
Russia anticipates a budget impact but plans to deploy its network of traders and shadow tankers to mitigate financial losses. Rosneft, led by Vladimir Putin’s ally Igor Sechin, and Lukoil, the country’s largest producers, are directly affected.
The European Union added further pressure on Russia with sanctions targeting its energy infrastructure, while Ukrainian attacks on refineries, pipelines, and export terminals continue. Kyiv recently claimed a strike on a Rosneft plant.
Previously, Western policy aimed to limit Kremlin revenue with a price cap to prevent price spikes, but the new sanctions mark a sharp policy shift. Following the announcement, the premium of front-month Brent futures over the next contract widened in a bullish backwardation structure, reflecting tightening supply concerns and a surge in oil prices.
Similar news
