Al-Arabiya _ Oil prices declined on Monday after U.S. President Donald Trump exempted Russia from sanctions and tariffs that could lead to an increase in Russian fuel exports.
Brent Crude Futures Drop 1.84% to $107.84 Per Barrel
Brent crude futures fell by $2.02, or 1.84%, to $107.84 per barrel by 04:18 GMT, after closing on Friday at its highest level since May 19.
U.S. Crude Declines 1.64% to $97.40 Per Barrel
U.S. West Texas Intermediate crude recorded $97.40 per barrel, down by $1.62 or 1.64%, after closing on Friday at its highest level since September 17.
Trump signed an executive order on Friday exempting from key sanctions and tariffs under the law known as the Graham Act, which he signed last month at the request of lawmakers seeking to increase pressure on Moscow over its war in Ukraine.
However, Secretary of State Marco Rubio said the president will use a period of up to 60 days to assess the economic impact of the sanctions and tariffs on the global economy.
The move comes after Trump reached an agreement with Russian President Vladimir Putin to export diesel to the United States and other countries, with volumes starting at approximately 2.3 million barrels this month before rising to about 7.6 million barrels per month, according to Trump's announcement. Ukrainian President Volodymyr Zelenskyy stated that these U.S. measures would harm Ukraine.
Brent crude briefly touched $110 a barrel on Friday for the first time since May, as tension and security threats in the Middle East raised concerns about navigation safety and tightening global energy supplies.
U.S. Exemption of Sanctions on Russia Will Support Russian Fuel Exports
Tim Waterer, market analyst at KCM Trade, said: “The combination of a softer tone on sanctions and some profit-taking following recent gains is helping to curb the short-term upward trend.”
He added that the U.S. exemption of sanctions on Russia could lead to an increase in Russian fuel exports, but mixed messages have created uncertainty.
He stated: “Until details and the timeframe become clear, the market is unlikely to fully price in a sustained increase in supply.”
Intensification of Attacks on Vessels Sharply Reduced Gulf Crude Flows Last Week
Analytics firm Kpler said in a note on Friday that the intensification of attacks on commercial vessels sharply reduced Gulf crude flows to an average of about 8.5 million barrels per day over a seven-day period last week, down from more than 20 million barrels per day the previous week.
It added that at least ten confirmed incidents involving commercial vessels were reported last week.
