WTI moves above $66.00 due to prospect of potential US sanctions on Russia

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West Texas Intermediate (WTI) Oil price retraces its more than 2% losses registered in the previous session, trading around $66.10 per barrel during the Asian hours on Friday. Crude Oil prices receive support from rising geopolitical risk premiums, driven by potential supply concerns.

WTI price appreciates due to rising geopolitical risk premium, driven by the supply concerns.
Trump signaled an upcoming announcement on Russia, sparking speculation over possible new sanctions on the major Oil exporter.
Signs of demand improvement emerge as Saudi Arabia is expected to ship around 51 million barrels of oil to China.

US President Donald Trump said he would soon make an announcement concerning Russia, fueling speculation about potential new sanctions on the major Oil exporter. Trump has expressed frustration with Russian President Vladimir Putin over stalled peace efforts in Ukraine and the escalating bombardment of Ukrainian cities, per Reuters.

Additionally, the prices of crude Oil also draw support from a sign of demand improvement, driven by the expectations of Saudi Arabia shipping about 51 million barrels of Oil to China, the highest in more than two years in August. However, OPEC lowered its global Oil demand forecasts for the period of 2026-2029, citing a slowdown in Chinese consumption, according to its 2025 World Oil Outlook released on Thursday.

However, the upside of the Oil prices could be limited due to concerns over global demand, driven by the fresh tariffs by US President Donald Trump. President Trump announced on Thursday a 35% tariff rate for goods imported from Canada, effective August 1, and signaled 15–20% blanket tariffs on most other trade partners. He added that the European Union (EU) would also receive a letter notifying them of new tariff rates "today or tomorrow."

WTI Oil FAQs

What is WTI Oil?

WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.

What factors drive the price of WTI Oil?

Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.

How does inventory data impact the price of WTI Oil

The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.

How does OPEC influence the price of WTI Oil?

OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.