Oil Prices Rise 2.5% After US Sanctions Rosneft and Lukoil

Oil benchmarks Brent and WTI surged by more than $2 a barrel. Photo: Bloomberg

Oil prices rose by roughly 2.5% on October 23, extending the previous day’s gains, after the United States imposed sanctions on Russia’s leading oil producers Rosneft and Lukoil amid ongoing fighting in Ukraine.

By 03:03 GMT, Brent crude futures had increased by $1.56, or 2.49%, to $64.15 a barrel, while US West Texas Intermediate (WTI) crude gained $1.53, or 2.62%, reaching $60.03. Washington warned it was ready to take additional measures as it urged Moscow to agree immediately to a ceasefire.

President Donald Trump, who had long resisted calls from US lawmakers to introduce energy sanctions, said he now believed it was the right time, as no resolution to the conflict appeared in sight. The UK imposed similar sanctions on Rosneft and Lukoil last week, and EU member states have just approved a 19th package of restrictions, including a ban on Russian LNG imports.

India’s state-owned refiners confirmed they were reviewing their imports of Russian oil to ensure none came directly from Rosneft or Lukoil following the new US sanctions.

Oil benchmarks Brent and WTI surged by more than $2 a barrel immediately after the announcement, also supported by a surprise fall in US crude inventories. However, traders expressed doubts that the sanctions would trigger a significant shift in supply dynamics.

In the near term, traders are keeping a close eye on a possible oil surplus from OPEC+ as production cuts are rolled back, which could influence prices in the coming months.

Kursiv also reports that Russia’s Energy Ministry has held talks with Kazakhstan and Belarus about possible supplies of gasoline and diesel fuel. Kazakhstan refused the offer.