Global oil prices: Trump’s sanctions on Russian firms trigger sharp rise; Brent crude futures soar nearly 5%

Oil prices rose sharply on Wednesday, triggered by America’s fresh sanctions on Russian oil companies.Brent crude futures jumped $3.03, or 4.94%, to $64.35 a barrel, while US West Texas Intermediate (WTI) crude added $1.42, or 2.43%, to $59.92 after the settlement at 6 PM EDT (2200 GMT). Earlier, Brent had settled $1.27 higher at $62.59 a barrel, and WTI gained $1.26 to $58.50, according to Reuters.US treasury secretary Scott Bessent highlighted the move against Moscow, saying, “Given President Putin’s refusal to end this senseless war, Treasury is sanctioning Russia’s two largest oil companies that fund the Kremlin’s war machine.” The sanctions target Lukoil and Rosneft, two of Russia’s biggest oil producers.US energy demand also fuelled the rally. The Energy Information Administration (EIA) reported that crude, gasoline, and distillate inventories all fell last week as refining activity and consumption increased. Crude stocks dropped by 961,000 barrels to 422.8 million barrels, contrary to analyst expectations of a 1.2 million-barrel rise.Phil Flynn, senior analyst at Price Futures Group, said the numbers show the strength of the market, “We have got total oil demand above 20 million bpd. Very impressive for shoulder season. It shows the demand side of the equation of oil is robust.” Traditionally, the shoulder season, spanning from late September to November, sees weaker energy demand, according to Reuters.Investors were also keeping an eye on US-China trade talks, with officials from both nations set to meet in Malaysia this week. US President Donald Trump said on Monday he expected a fair trade deal with Chinese President Xi Jinping, whom he is scheduled to meet in South Korea next week. On Wednesday, Trump confirmed a long meeting with Xi during his visit.Meanwhile, supply worries surfaced after a planned summit between Trump and Russian President Vladimir Putin was postponed. Western governments have been pressuring Asian buyers to reduce purchases of Russian oil.