Oil Prices Increase Over 5% After US Sanctions Target Russia's Rosneft, Lukoil

Oil prices surged by more than 5% following fresh U.S. sanctions on Russia's two largest oil companies, Rosneft and Lukoil, due to their role in funding the war in Ukraine. Brent crude rose to nearly $66 per barrel, with U.S. West Texas Intermediate crude increasing similarly, driven by concerns that major buyers like China and India will need to find alternative suppliers to avoid Western banking restrictions. The sanctions, announced by the U.S. Treasury, were supported by previous moves from the U.K. and the EU, including a ban on Russian LNG imports. Indian refiners, previously the largest buyers of discounted Russian crude, are expected to sharply reduce or halt imports from these sanctioned companies, influenced by pressure from the U.S. administration under President Trump. However, there is market skepticism about the long-term impact of these sanctions, given past difficulties in significantly reducing Russian oil production or revenues despite earlier sanctions. The U.S. has also signaled readiness to impose further actions to push Russia toward a ceasefire in Ukraine.