Crude Oil Prices Fall as Russia Sanctions Have Limited Impact, US-EU Trade Tensions Grow

Crude oil prices fell in Asian markets on July 22, 2024. This came even though the U.S. dollar weakened, a factor that usually supports oil. The latest European Union (EU) sanctions on Russia would not have a major effect on global oil supply.

• Brent crude (Sept) fell 0.5% to $68.86/barrel
• WTI crude dropped 0.5% to $65.61/barrel

US-EU Trade War Concerns Add Pressure

Markets were also nervous about rising trade tensions between the U.S. and the EU. Reports say the U.S. is asking for at least a 15% tariff on EU imports. This caught EU officials off guard and may lead to counter-tariffs on American goods.

As per reports, if a deal isn’t reached, it could hurt the economy and reduce demand for oil. The U.S. has also planned steep tariffs on other major trading partners starting August 1:

• 25% on Japan
• 35% on Canada
• 50% on Brazil

These tariffs could slow global trade and oil consumption.

Russia Sanctions Seen as Ineffective

New EU sanctions targeting Russia’s oil industry didn’t move the market much.

The Russia-Ukraine war has now lasted over 3 years. It initially pushed oil prices up, but now markets don’t expect big disruptions from the conflict. However, U.S. sanctions on Russian oil remain strict.

Read More: EU Sanctions Rosneft’s Nayara Energy Stake, Cuts Russian Oil Price Cap!

Conclusion

Oil markets are facing pressure from 2 sides, weak sanctions on Russia that won’t cut supply and fears that a US-EU trade war could hurt demand. With global economic uncertainty rising, oil prices may continue to feel downward pressure.

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