Crude Oil Rallies After US Sanctions Major Russian Oil Producers

• At the time of writing, U.S. West Texas Intermediate (WTI) crude futures maturing in December were up 5%, rising to $61.45 per barrel.
• Late Wednesday, the Trump administration announced sanctions on Russian oil producers, Rosneft and Lukoil.
• Treasury Secretary Scott Bessent called on President Putin to immediately agree to a ceasefire with Ukraine.

Crude oil prices surged by more than 5% on Thursday after the Trump administration imposed sanctions on major Russian oil producers in its latest push for a ceasefire between Russia and Ukraine.

At the time of writing, U.S. West Texas Intermediate (WTI) crude futures maturing in December were up 5%, rising to $61.45 per barrel, compared to the previous closing price of $58.5.

Brent crude futures maturing in December gained 4.6%, rising to $65.47 per barrel.

ING Analysts Call Sanctions Significant

In a recent note following the sanctions placed by the U.S. on major Russian oil producers, analysts at ING Think stated that these measures are significant.

“The key question is whether these sanctions are enough to deter buyers of Russian oil, specifically China and India,” the firm said in its latest note, adding that the markets are concerned about oil flows from Russia.

On Wednesday, the Trump administration announced sanctions on Russian oil producers, Rosneft and Lukoil. Treasury Secretary Scott Bessent called on Moscow to immediately agree to a ceasefire with Ukraine.

“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. Treasury is prepared to take further action if necessary to support President Trump’s effort to end yet another war.”

— Scott Bessent, U.S. Secretary of the Treasury

Effectiveness Of Sanctions

The firm’s analysts stated that it remains to be seen whether the Trump administration’s sanctions on Rosneft and Lukoil are effective, or whether Russia can circumvent them as it did the curbs announced by the Biden administration in January.

In January, Gazprom Neft and Surgutneftegas were sanctioned along with a large part of Russia’s shadow fleet of oil tankers. “These sanctions had little impact on Russian oil exports,” the firm noted.

The United States Oil Fund LP (USO) rose 4%, while the ProShares Ultra Bloomberg Crude Oil (UCO) was up by 3.8% at the time of writing. Stocktwits data showed the retail sentiment around UCO was in the ‘bullish’ territory at the time of writing.

Also See: Dow Futures Edge Lower As Investors Exercise Caution After Record S&P 500 Close: GM, KO, NXPI, AZN Among Stocks To Watch

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