Oil prices are trading in positive territory, extending last week’s gains, as investors react to moves by the Trump administration to curb the purchase of Russian crude by a number of allies, at a time when concerns are growing over a potential oversupply of the commodity in the global market.
This morning, Brent, the European benchmark, is up 0.66% at $67.43 per barrel, while West Texas Intermediate (WTI), the U.S. benchmark, is trading at $63.12, an increase of 0.69%. Both benchmarks closed last week with a positive balance of 2.3%, driven by escalating global geopolitical tensions.
Over the weekend, Donald Trump reiterated the need for European countries to stop buying Russian oil—the main source of revenue for the country led by Vladimir Putin, which has been financing the war in Ukraine. The President of the United States appears determined to end the conflict as quickly as possible and has indicated he may introduce new sanctions on Moscow, but only if all NATO countries decide to do the same. Although most European countries have already significantly reduced their purchases of Russian crude, nations such as Turkey and Hungary continue to rely on this supply. At the upcoming G7 meeting this week, the U.S. leader is also expected to increase pressure on allies to impose tariffs of up to 100% on imports from China and India, Russia’s main partners.
Investors are also closely monitoring the geopolitical situation in the Middle East, following last week’s Israeli attack on Qatari territory aimed at targeting Hamas leadership present in the country, as well as developments in the war in Ukraine, with Kyiv attacking Russia’s energy infrastructure. “The stalemate in Ukraine is the key factor in the oil market, and the immediate risk is to the upside due to the possibility of further sanctions and more attacks on Russia’s oil export infrastructure,” explained Vandana Hari, founder of market analysis firm Vanda Insights, to Reuters.
Source: Diário Económico
