Crude prices soared on Thursday, boosted by the U.S. Treasury Department’s announcement of sanctions against Russian oil groups Rosneft and Lukoil, measures likely to tighten global oil supply.
“Faced with President Putin’s refusal to end this senseless war, the Treasury Department is imposing sanctions on the two largest oil companies financing the Kremlin’s war machine,” explained Treasury Secretary Scott Bessent.
Mr. Bessent added that his department was “ready to go further if necessary,” urging the United States’ allies “to join these sanctions.”
Meanwhile, the European Union announced on Wednesday that it had reached an agreement to toughen its sanctions on Russian hydrocarbons and cut off the Kremlin’s financial resources.
On Thursday, a spokesperson for the Russian Ministry of Foreign Affairs denounced the U.S. measures, claiming that Russia was “immune” to such economic pressure.
At 09:30 GMT (11:30 in Paris), a barrel of Brent crude from the North Sea for December delivery was up 4.92% at $65.67, after briefly topping 5%. Its American counterpart, the West Texas Intermediate (WTI) for the same month, rose 5.06% to $61.46.
“Rosneft and Lukoil account for about 50 to 55% of Russia’s crude oil production,” noted Giovanni Staunovo, an analyst at UBS.
Market attention is now turning to India, Russia’s second-largest crude oil buyer, after Donald Trump reiterated earlier this week that New Delhi intended to halt its imports of Russian oil.
This marks “the first time that Russian crude oil exports have been directly targeted” by the United States, according to Arne Lohmann Rasmussen, analyst at Global Risk Management — previous G7 sanctions had set a price cap on Moscow’s barrels but had not reduced export volumes.
This time, the measures will have a “negative impact on Russian crude oil exports to India and Turkey,” said Jorge Leon, analyst at Rystad Energy, adding that Russia may still resort more extensively to its “shadow fleet” used to circumvent sanctions.
However, prices remain relatively moderate overall, as the market also observes robust supply growth from the Americas (United States, Canada, Brazil, Guyana, etc.) and particularly from OPEC and its allies.
