Oil prices rose on Wednesday, rebounding from a five-week low recorded the day before, amid fears of supply disruptions after US President Donald Trump's threats to impose tariffs on India over its purchases of Russian oil, UNN reports with reference to Reuters.
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Brent crude futures rose 43 cents, or 0.6%, to $68.07 a barrel by 03:30 GMT (06:30 Kyiv time), while US West Texas Intermediate crude rose 40 cents, or 0.6%, to $65.56 a barrel.
"There remains significant uncertainty regarding the US imposing additional tariffs on buyers of Russian oil... there is growing talk in the market that China's purchases of Russian oil could be the next focus," ING commodity strategists said on Thursday.
"If India stops buying Russian oil amid tariff threats, we believe the market can cope with the loss of these supplies," they said, adding that the greater risk is that other buyers will start avoiding Russian oil.
Both oil contracts fell more than $1 on Tuesday, reaching a five-week low, marking the fourth trading session of losses, amid oversupply concerns due to OPEC+'s planned production increase in September.
"Investors are assessing whether India will cut purchases of Russian oil in response to Trump's threats, which could lead to supply cuts, but it is unclear whether this will actually happen," said Yuki Takashima, an economist at Nomura Securities.
"If India's imports remain stable, WTI oil prices are likely to remain in the $60-$70 range until the end of the month," he said.
OPEC+ agreed on Sunday to increase oil production by 547,000 barrels per day in September. This decision, it is noted, will allow the cessation of the introduced production cut earlier than planned.
At the same time, US demands for India to stop buying Russian oil, as Washington tries to push Moscow towards a peace agreement with Ukraine, could disrupt supplies as Indian refineries seek alternatives and Russian oil is redirected to other buyers.
On Tuesday, Trump again threatened to raise tariffs on Indian goods over Russian oil purchases within the next 24 hours. Trump also said that lower energy prices could put pressure on Kremlin head Vladimir Putin and force him to end the war in Ukraine.
New Delhi called Trump's threat "unjustified" and vowed to protect its economic interests, which exacerbated the trade rift between the two countries.
Takashima of Nomura also pointed to industry data showing US oil inventories, the world's largest oil consumer, as favorable for the oil market. Sources citing American Petroleum Institute data said on Tuesday that US oil inventories fell by 4.2 million barrels last week.