Oil prices closed about 1% higher on Wednesday as traders focused on U.S. President Donald Trump’s tightened timeline for Russia to end the war in Ukraine and new tariff threats targeting countries that trade Russian oil.
Brent crude for September delivery, set to expire Thursday, rose 73 cents (1.01%) to settle at $73.24. The more actively traded October Brent contract climbed 79 cents (1.1%) to $72.47. U.S. West Texas Intermediate (WTI) crude gained 79 cents (1.14%) to close at $70.
The market had been down nearly 1% earlier in the day but rebounded as Trump announced a shortened deadline of 10 to 12 days—down from 50—to take action against Russia, including potential 100% secondary tariffs on trading partners. The U.S. also imposed a 25% tariff on imports from India effective August 1 and threatened unspecified penalties for countries purchasing Russian oil and weapons, including China.
Analysts noted that India appears willing to comply, which could impact 2.3 million barrels per day of Russian exports—a bullish signal for oil prices.
In inventory news, U.S. crude stocks unexpectedly rose by 7.7 million barrels, while gasoline inventories fell by 2.7 million barrels, surpassing expectations for a 600,000-barrel draw. Distillates increased by 3.6 million barrels, much more than the projected 300,000-barrel build.
U.S. GDP rebounded more than expected in Q2, though much of the gain came from reduced imports. Meanwhile, the Federal Reserve held interest rates steady, with Chairman Powell noting it’s still unclear whether a rate cut will come in September.