Oil Prices Get Boost From EU Sanctions On Russian Oil, Iraqi Oilfields Attacks

Oil prices gained on Friday after the European Union agreed to slap fresh sanctions against Russia, while fears of supply disruptions also rose following drone attacks on northern Iraqi oilfields.

As per a Reuters report, the EU has approved the 18th sanctions package on Russia, aiming to hit Moscow’s revenue as the Ukraine War continues to claim thousands of lives. According to the latest sanctions package, the G7 price cap for Russian oil will decrease to $47.6 per barrel, indicating that any entity acquiring or facilitating a transaction at a higher price will face sanctions.

Benchmark Brent crude prices rose 0.3% at $69.76 per barrel, while U.S. West Texas Intermediate prices rose 0.5% at $67.86 per barrel at 8.14 a.m. GMT.

Retail sentiment on Stocktwits regarding the United States Oil Fund remained in the ‘bearish’ territory, but with an improved score.

Separately, drone attacks on oilfields in the semi-autonomous Kurdistan region continued for the fourth day, slashing output from the area to between 140,000 barrels per day (bpd) and 150,000 bpd from 280,000 bpd, Reuters reported, citing two energy officials. As per the report, the officials blamed Iran-backed militias as the likely source of attacks this week on the region's oilfields, although no group has claimed responsibility.

A robust summer travel demand also supported oil prices. JPMorgan analysts noted that in the first two weeks of July, global oil demand averaged 105.2 million bpd, up 600,000 bpd from a year earlier. U.S. crude inventories had also fallen by 3.9 million barrels last week, surpassing expectations.

Donald Trump’s tariffs have added an air of uncertainty to oil demand, with a fresh set of tariffs expected to take effect on August 1. Some analysts fear that oil supply will outpace demand after the summer driving season ends.

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