Trump Tariffs On India Keep Traders Buoyant, Oil Extends Gains

Meanwhile, Russia's oil infrastructure seems intact after 8.8 magnitude earthquake: File Image/Pixabay

As of 1528 GMT on Wednesday, oil trading was shaping up as a repeat of the previous session, with prices edging higher based on U.S. president Donald Trump’s tariff strategies – as well as his vow to sanction Russia unless it reaches a peace deal with Ukraine soon.

Brent was up 40 cents to $72.09 per barrel, and West Texas Intermediate was up 76 cents at $69.97.

The latest development in Trump’s tariff/sanctions strategy saw India agreeing with his demand not to import any oil from Russia, which could affect 2.3 million barrels per day (bpd) for the former Soviet Union.

Vikram Misri, foreign secretary to India, acknowledged that his country could increase its energy purchases from the U.S. from $15 billion to $25 billion in the future.

Washington is expected to hike tariffs on imports from Brazil to 50 percent, 35 percent for Canada, 30 percent for Mexico, and 25 percent for South Korea on Friday.

India was also hit with a 25 percent tariff on all goods imported from that country, effective August 1.

Trump wrote on Social Truth, “While India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high, among the highest in the World, and they have the most strenuous and obnoxious non-monetary Trade Barriers of any Country.”

Dennis Kissler, senior vice president of trading at BOK Financial, said, "Traders seem more focused on the tariffs [related to Russia] and the compliance by India is being taken as a positive towards crude prices.”

Also buoying Wednesday’s mild bullish sentiment was data from the U.S. Energy Information Administration, which showed that gasoline stocks fell by 2.7 million barrels; traders seemed to shrug off news that distillates rose by 3.6 million barrels.

In other oil news on Wednesday, following the 8.8 magnitude earthquake off Russia’s Kamchatka Peninsula, the Sakhalin-2 LNG facility in Prigorodnoye, operated by Sakhalin Energy, continued  to load vessels, with no damage reported to storage tanks or marine berths, and oil export terminals at Aniva Bay and the TransSakhalin pipeline system remained online.