WTI surges above $65.00 as traders expect India to reduce Russian Oil imports
- WTI appreciates over rising concerns over potential supply disruptions.
- India may scale back Russian Oil imports in response to Trump’s tariff threats over its ongoing purchases.
- West Africa-focused Tullow Oil lowered its 2025 Oil production forecast to 40,000–45,000 barrels per day.
West Texas Intermediate (WTI) Oil price halts its four-day losing streak, trading around $65.10 per barrel during the Asian hours on Wednesday. Crude Oil prices gain ground amid rising concerns over potential supply disruptions.
Traders are weighing possible supply shifts as India may reduce Russian Oil imports in response to US President Donald Trump’s tariff threats over its continued purchases. Trump announced on Tuesday that he would increase the tariffs charged on Indian imports "very substantially" over the next 24 hours, citing India’s continued purchases of Russian Oil.
West Africa-focused Tullow Oil cut its Oil production forecast to 40,000-45,000 barrels per day for 2025 after it sold its Gabonese assets, and reported a first-half loss of $80 million on Wednesday, per Reuters.
Additionally, American Petroleum Institute (API) data showed US Weekly Crude Oil Stock fell by 4.2 million barrels last week, against the previous increase of 1.54 million barrels. The US stockpiles have surpassed market expectations of a 1.8 million-barrel draw and suggesting stronger-than-anticipated demand.
However, Oil prices may further depreciate amid oversupply concerns after the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, recently announced it will raise Oil production by 547,000 barrels per day in September, effectively ending its latest round of output cuts sooner than anticipated.
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
Author
Akhtar Faruqui
FXStreet
Akhtar Faruqui is a Forex Analyst based in New Delhi, India. With a keen eye for market trends and a passion for dissecting complex financial dynamics, he is dedicated to delivering accurate and insightful Forex news and analysis.
