Oil prices fall despite Russia sanctions threat and Trump's 'major' statement
Published: 04:17 11 Jul 2025 EDT
Shares in oil-producing companies were given a lift after crude oil prices rose on Friday, with analysts pointing to Donald Trump's comments that he plans to make a "major statement on Russia".
Markets took this to imply sanctions, though the US President did not elaborate in his interview with CNBC, only to say that he would reveal all on Monday.
Brent crude front-month futures had reached $70.50 a barrel on Thursday before falling to $68.75 on Friday morning, rising only slightly to $68.88 as Reuters picked up the Russia story as an angle.
Similarly, US West Texas Intermediate crude prices fell from almost $69 a barrel to $66.5 overnight, and have been largely flat since.
The IEA’s July oil market report indicated that global oil demand is starting to cool off, with growth set to rise by only 700,000 barrels a day this year.
That was the slowest pace since 2009, not including the pandemic slump, as emerging markets in particular are consuming less and using renewables more.
Meanwhile, supply is booming, with June output jumping by nearly a million barrels a day, led by Saudi Arabia.
The IEA noted that while on paper there’s plenty of oil, strong refining margins and pricing signals point to a market that’s tighter than it looks. Non-OPEC producers are expected to keep driving supply higher into 2026.
Oil prices have gradually risen in the past week.
This is despite the recent news that the OPEC group of oil-producing countries will stop adding extra barrels to the market after unwinding the last chunk of the 2.2mbpd cuts in September, and reports of ships being sunk by Houthi rebels in the Red Sea.
On the prospect of stronger sanctions against Russia, Swissquote Bank analyst Ipek Ozkadeskaya said: "Europe wants to cut the price cap on Russian oil from $60 to $45 per barrel, and a new bipartisan US bill proposes slapping 500% tariffs on goods from countries buying Russian oil.
"That would hit China and India, which together buy around 70% of Russian supply.
"Depending on how these EM giants react, demand for US and Brent crude could spike, pushing WTI and Brent prices higher."
But she said oil bulls "are nowhere to be found this morning".
Key support for US crude remains at $65 per barrel, Ozkadeskaya said, and for Brent at $67.
"Below those levels, oil will likely return to the first half’s bearish trend."
