Oil prices climbed sharply Thursday after President Donald Trump imposed sweeping sanctions on Russia’s two largest oil companies, Rosneft and Lukoil, marking Washington’s most forceful economic move yet to pressure Moscow over the war in Ukraine.
Brent crude rose nearly 5% to $65.65 a barrel — a two-week high — following the announcement that all U.S. assets belonging to Rosneft and Lukoil would be frozen. American companies and individuals are now barred from doing business with the firms, a move expected to disrupt global oil trade flows already strained by geopolitical tensions.
The U.S. also warned that secondary sanctions could follow for foreign banks and intermediaries helping facilitate Russian oil sales, particularly in China, India, and Turkey. Those threats appeared to ripple quickly: reports indicated Indian refiners, including Reliance Industries — the country’s largest buyer of Russian crude — were preparing to cut or even halt imports.
India has been one of the chief beneficiaries of discounted Russian oil since the start of the war, but its energy ties with Moscow have increasingly drawn scrutiny in Washington. Trump already imposed a 50% tariff on most Indian goods in August as part of his broader trade strategy.
The sanctions announcement helped lift energy stocks in Europe, with Shell and BP each gaining nearly 3% in early trading, ranking among the day’s top performers on the FTSE 100. Analysts said the jump reflected expectations of tighter global supply and higher profit margins for Western producers.
The penalties mark the first time since returning to office in January that Trump has taken direct action against Russian state-linked energy firms. The European Union followed with plans for its own measures, including a ban on Russian liquefied natural gas imports, expected to be enacted on Thursday.
Source: The Guardian