Slight Increase in Oil Prices Amid Anticipation of European Sanctions Ramifications on Russia

Oil prices witnessed a slight increase during trading on Monday, July 21, amid market anticipation of the potential effects of the new European punitive package on Russian oil exports. Customs duties raised concerns about a decline in fuel demand, while Middle Eastern countries continue to enhance their production.

Brent crude futures rose by 0.14% to reach $69.38 per barrel, after falling by 0.35% at the close of trading last Friday. Additionally, West Texas Intermediate crude oil increased by 0.2% to $67.52 per barrel, following a 0.30% decrease in the previous session.

On Friday, the European Union approved the eighteenth package of sanctions against Russia due to the war in Ukraine, which also included the Indian energy company "Nayara," a exporter of refined oil products from Russian crude.

In response, Kremlin spokesman Dmitry Peskov stated that Russia has developed "certain immunity" against Western sanctions. Meanwhile, the Russian company Rosneft, the largest oil producer in the country and a contributor to "Nayara," criticized these actions as "unjustified and illegal," warning that they "directly threaten energy security in India."

In a related context, the Iranian Foreign Ministry spokesperson announced today that Tehran will hold nuclear talks in Istanbul on Friday with Britain, France, and Germany, following warnings from the European Troika countries of reimposing sanctions on Iran if negotiations fail.

Separately, Baker Hughes, an energy services company, revealed a decrease in the number of active drilling rigs in the United States by two rigs last week, reaching 422 rigs, the lowest since September 2021.

The U.S. customs duties on European Union imports are set to take effect on August 1, despite U.S. Commerce Secretary Raimondo's Sunday statement expressing confidence in reaching a trade agreement with the European bloc.