Oil Prices Ease Amid EU Sanctions and Ukraine Strikes

Highlights:

• At the time of writing, WTI crude traded near US$63 a barrel, with Brent holding above US$66.
• The EU’s next sanctions round targets oil industry entities in China and India to further restrict Russia’s revenues.
• Geopolitical tensions persist as the U.S. urges Europe to halt Russian crude imports, while France calls remaining reliance “marginal.”

Market Movement

Oil prices slipped as traders weighed the impact of fresh European Union sanctions targeting Russian supplies alongside continued Ukrainian strikes on Russian energy infrastructure. At the time of writing, West Texas Intermediate (WTI) crude for October delivery was trading near US$63 a barrel ahead of its expiry on Monday. The more liquid November contract hovered around US$62, while global benchmark Brent crude held above US$66.

EU Tightens Sanctions

The EU’s upcoming sanctions package will expand restrictions to oil industry entities operating in third countries. Reports indicate that the sanctions could impact nearly a dozen Chinese firms along with multiple Indian entities. The move highlights Brussels’ determination to squeeze Moscow’s energy revenues by limiting its access to global oil markets. These sanctions come on top of the Group of Seven (G7) price-cap mechanism, which was designed to allow Russian oil to flow while curbing the Kremlin’s financial gains. However, discounted Russian crude continues to find buyers, particularly in Asia, where China and India have been the largest beneficiaries.

Global Political Pressure

Geopolitical tensions remain central to oil’s outlook. U.S. President Donald Trump recently reiterated his call for European nations to halt Russian crude imports altogether, while French President Emmanuel Macron countered that the EU’s remaining energy dependence on Moscow is now “very marginal.”

Outlook

The combination of tighter sanctions, geopolitical risks, and shifting demand dynamics is expected to keep volatility elevated in global energy markets. Analysts suggest that while Russia’s discounted supplies continue to flow to Asia, ongoing sanctions and military tensions could create fresh supply disruptions in the months ahead.

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