Oil prices declined on Thursday as U.S. President Donald Trump pushed for a rapid resolution to the war in Ukraine and issued fresh tariff threats on nations continuing to purchase Russian oil, driving investor concerns over potential supply shortages.
As of 4:15 GMT, Brent crude futures fell 16 cents, or 0.22 percent, to $73.08 a barrel, while U.S. West Texas Intermediate crude dipped 0.11 percent to $69.92 a barrel. Both Brent crude futures for September delivery and U.S. West Texas Intermediate crude for September settled 1 percent higher on Wednesday.
Trump threatens to impose tariffs on Russian oil buyers
Despite the marginal fall in oil prices on Thursday, concerns over tightening global oil supplies continued to fuel buying interest in early trading as markets reacted to the potential impact of secondary tariffs on countries importing Russian crude.
On Tuesday, President Trump announced that if Russia failed to show progress in ending the war within 10 to 12 days—significantly earlier than his previous 50-day deadline—the U.S. would impose 100 percent secondary tariffs on its trading partners. These developments intensified fears of supply disruptions.
On Wednesday, Trump confirmed that trade negotiations with India were ongoing, even after announcing a 25 percent tariff on Indian imports starting Friday. The U.S. has also issued a warning to China, Russia’s largest oil customer, that it could face substantial tariffs if it continued purchasing Russian crude, escalating tensions in global energy and trade markets.
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U.S. crude oil inventories rise to 426.7 million barrels
On Wednesday, the U.S. Treasury Department imposed new sanctions on more than 115 Iran-linked individuals, entities and vessels, reinforcing the Trump administration’s renewed “maximum pressure” campaign following its June airstrikes on key nuclear facilities in Tehran. China, which remains the largest buyer of Iranian oil, is likely to be a key focus as the U.S. seeks to curb Tehran’s energy exports.
Meanwhile, U.S. crude oil inventories unexpectedly rose by 7.7 million barrels in the week ending July 25, reaching 426.7 million barrels, according to the Energy Information Administration (EIA). The build was largely attributed to a drop in exports and contrasted sharply with analyst expectations of a 1.3 million-barrel draw.
In contrast, gasoline stocks declined by 2.7 million barrels to 228.4 million barrels, a much steeper drop than the anticipated 600,000-barrel decrease.
U.S. inventory data showed a mixed picture, with a larger-than-expected build in crude oil stocks offset by a bigger-than-anticipated draw in gasoline inventories. While the crude build pointed to weaker export activity, the sharp decline in gasoline stocks reinforced expectations of strong seasonal driving demand. Overall, the data had a neutral impact on oil prices, balancing concerns about supply.
