Oil prices fell over $1 on Monday as traders digested new sanctions threats from U.S. President Donald Trump aimed at buyers of Russian oil, even as broader concerns about tariffs and future demand lingered. Brent crude settled at $69.21 a barrel, down $1.15 or 1.63%, while U.S. West Texas Intermediate (WTI) closed at $66.98, down $1.47 or 2.15%.
Prices initially climbed on expectations of aggressive U.S. sanctions following Trump’s warning to impose penalties on countries purchasing Russian crude unless Moscow reaches a peace deal within 50 days. However, those gains reversed as traders assessed the likelihood and timing of any such action. Analysts suggested the delay and uncertainty around implementation dampened urgency in the market.
China and India — two of the largest importers of Russian oil — were seen as unlikely targets for aggressive tariff enforcement. Market participants noted that 100% tariffs on China would be politically risky and inflationary. Meanwhile, momentum in Congress for a bipartisan sanctions bill and an upcoming EU package with a proposed lower price cap on Russian oil added to the diplomatic pressure on Moscow.
Additional downside pressure came from geopolitical tensions surrounding U.S. trade talks. EU and South Korean officials were in negotiations with Washington to mitigate the effects of tariffs scheduled for August 1. Comments from EU officials reflected rising frustration with what they called “absolutely unacceptable” threats from Trump’s administration.
Still, signs of strong demand offered some support. China’s June crude imports rose 7.4% year-over-year to 12.14 million barrels per day, the highest since August 2023. Yet despite those figures, the IEA’s recent forecast revision — raising supply estimates while trimming demand growth — continued to suggest a possible global surplus in the second half of 2025.