Oil prices slip as Trump’s Russia deadline eases supply fears 

SINGAPORE: Oil prices fell slightly on Tuesday as markets reacted to US President Donald Trump’s 50-day deadline for Russia to end the Ukraine war. The extended timeline eased immediate concerns about sanctions on Russian oil exports, which had earlier pushed prices higher.

By 0342 GMT, Brent crude had dropped 29 cents, or 0.4 per cent, to $68.92 per barrel. US West Texas Intermediate (WTI) crude also declined by 35 cents, or 0.5 per cent, to $66.63. Both benchmarks had lost over a dollar in the previous session.

Traders had initially responded to Trump’s threats of sanctions with concern over possible supply disruptions. However, the long deadline gave markets some breathing room and raised doubts about whether the US would follow through. 

“Trump’s softer approach on Russian oil sanctions reduced fears of an immediate supply crunch, although his tariff threats still add economic uncertainty,” said Priyanka Sachdeva, a senior market analyst at Phillip Nova. 

According to ING analysts, if the US does impose the proposed sanctions, it could significantly reshape the global oil market. “China, India and Turkey, being the largest buyers of Russian crude, would have to weigh cheap oil imports against potential losses in their US exports,” they noted. 

Trump on Monday also announced new military support for Ukraine and reiterated his plan to impose a 30 per cent tariff on most imports from the European Union and Mexico starting August 1. These tariffs, along with earlier warnings to other countries, have raised concerns about a global economic slowdown, which could weaken oil demand. 

Despite the uncertainty, the Organisation of the Petroleum Exporting Countries (OPEC) expects oil demand to remain “very strong” through the third quarter, according to a Russian media report quoting OPEC’s secretary general. 

Goldman Sachs, meanwhile, has raised its oil price forecast for the second half of 2025, citing potential supply disruptions, tighter inventories in developed economies, and production issues in Russia. 

Read next: Bitcoin climbs to record $123,000 as investors eye US policy boost