Oil prices saw a pause during Asian trading on Wednesday following a notable surge of over 3 percent in the previous session, as investors looked ahead to potential developments stemming from U.S. President Donald Trump’s tightened deadline for Russia to conclude its military operations in Ukraine.
The most actively traded Brent crude futures climbed by 8 cents, or 0.12 percent, reaching $71.78 a barrel by 04:20 GMT. Meanwhile, U.S. West Texas Intermediate crude also increased by 8 cents, or 0.12 percent, to settle at $69.29 a barrel.
The September contract for Brent crude, which is set to expire on Wednesday, saw an uptick of 18 cents, bringing it to $72.69 per barrel. Both contracts had concluded Tuesday at their highest levels since June 20.
Trump’s new measures against Russia
On Tuesday, Trump announced that he would begin imposing measures against Russia, including secondary tariffs of 100 percent on trading partners, unless progress was made in resolving the war within a 10 to 12-day timeframe, a significant reduction from the earlier 50-day deadline.
The United States cautioned China, the largest purchaser of Russian oil, that it could incur substantial tariffs if it continued its buying practices. Treasury Secretary Scott Bessent made these remarks during a news conference in Stockholm, where the U.S. was engaged in trade discussions with the European Union.
Analysts at JP Morgan noted in a report that while China is unlikely to adhere to U.S. sanctions, India has indicated a willingness to comply, potentially jeopardizing 2.3 million barrels per day of Russian oil exports.
The United States and the European Union managed to avoid a trade war by reaching an agreement on 15 percent U.S. tariffs on European imports. This development alleviated concerns regarding the impact of trade tensions on economic growth, providing some support to oil prices.
In Venezuela, foreign partners of the state oil company PDVSA are still awaiting U.S. authorization to resume operations in the sanctioned nation after discussions last week, which could lead to a return of some supply to the market, thus alleviating upward price pressures.
Despite President Donald Trump’s objections, the U.S. Federal Reserve is anticipated to maintain interest rates at their current levels during its policy meeting later on Wednesday.
Read more: Crude oil prices climb above $69.2 as U.S.-China trade truce and EU deal support market
IMF adjusts growth forecasts
The International Monetary Fund (IMF) slightly adjusted on Tuesday its global growth forecasts upward for 2025 and 2026 but cautioned that the world economy faces significant risks, including a potential rebound in tariff rates, geopolitical tensions, and increasing fiscal deficits.
Regarding the data, U.S. crude oil inventories experienced an increase last week, which could limit potential upward movement in WTI prices. The American Petroleum Institute (API) reported that crude oil stockpiles in the U.S. rose by 1.539 million barrels for the week ending July 25, contrasting with a decrease of 577,000 barrels in the prior week. Market expectations had predicted a decline of 2.5 million barrels. Year-to-date, crude oil inventories have risen by nearly 13 million barrels, based on Oilprice calculations of API data.
Oil traders will closely monitor the U.S. Energy Information Administration (EIA) weekly crude oil stock report later on Wednesday. Additionally, the U.S. Federal Reserve’s interest rate decision will be a focal point, with the central bank likely to keep rates steady at 4.25 percent to 4.50 percent at the conclusion of its two-day monetary policy meeting on Wednesday.
