By: Ahmed Abdel Salam
Oil prices fell during trading following a U.S. decision to exempt Russia from some sanctions and customs duties, paving the way for a potential increase in the supply of Russian fuel to global markets. Crude contracts recorded a noticeable decline after touching high levels at the end of last week due to geopolitical tensions and market interest in the security of supplies.
Brent crude futures fell by about $1.43, or 1.30 percent, to settle at $108.43 per barrel, after closing the previous session at its highest level since May. Meanwhile, U.S. West Texas Intermediate (WTI) crude fell by 53 cents, or 0.52 percent, to record $100.88 per barrel.
Background of the U.S. decision and its implications
This development comes after U.S. President Donald Trump signed an executive order exempting Russia from key sanctions and customs duties under legislation known as the Graham Act, which was passed with the aim of increasing pressure on Moscow in the context of the war in Ukraine. For his part, Foreign Minister Marco Rubio explained that the U.S. administration will utilize a period of up to 60 days to assess the economic impacts of this exemption.
This move coincides with an agreement reached between the U.S. President and his Russian counterpart Vladimir Putin to export diesel to the United States. In contrast, Ukrainian President Volodymyr Zelensky expressed his objection to these measures, considering that they could harm his country. Markets had witnessed upward pressure on prices at the end of last week, as Brent crude touched the $110 per barrel level for the first time since May, amid concerns regarding the safety of navigation and the tightening of global energy supplies.
