Crude oil futures experienced slight fluctuations on Thursday morning, with traders concerned about potential supply risks due to upcoming sanctions.
Oil Futures Prices on the Move
As of 9:54 AM on Thursday, February Brent oil futures were priced at $73.58, up by 0.08%, while January WTI (West Texas Intermediate) futures traded at $70.28, down by 0.01%.
On the Multi Commodity Exchange (MCX), December crude oil futures were trading at ₹5967, a 0.56% increase from the previous close of ₹5934. Meanwhile, January futures were at ₹5960, up 0.52% from the previous close of ₹5929.
EU Sanctions Against Russia and US Strategy
The fluctuations came amid growing concerns about supply risks linked to sanctions. On Wednesday, European Union ambassadors introduced a 15th sanctions package against Russia in response to the ongoing war in Ukraine.
Janet Yellen, U.S. Treasury Secretary, stated that the U.S. continues to explore ways to reduce Russia’s oil revenue, while Russia accused the Biden administration of seeking to leave a difficult legacy in U.S.-Russia relations through the tightening of sanctions on Russian oil exports.
U.S. Crude Inventory Declines
In the U.S., the Energy Information Administration (EIA) released its weekly petroleum status report, showing a decline in crude oil inventories. For the week ending December 6, U.S. commercial crude oil inventories fell by 1.4 million barrels, bringing the total to 422 million barrels, which is about 6% below the five-year average for this time of year.
In contrast, motor gasoline inventories increased by 5.1 million barrels but remained about 4% below the five-year average. Similarly, distillate fuel inventories saw a rise of 3.2 million barrels.
U.S. Oil Imports and Demand Trends
The U.S. crude oil imports averaged 6 million barrels per day, a decrease of 1.3 million barrels compared to the previous week.
Meanwhile, the demand for oil products showed a slight increase. Over the past four weeks, the average daily supply of petroleum products was 20.1 million barrels, up 0.9% compared to last year. Specifically, motor gasoline supply rose by 1.4% compared to the previous year.
OPEC+ Report Signals Weakened Global Demand
The OPEC+ (Organization of the Petroleum Exporting Countries and Allies) released its monthly oil market report, highlighting weaker-than-expected global oil demand. OPEC+ forecasted that global oil demand growth would increase by 1.4 million barrels per day in 2025, marking a slight downward revision of 90,000 barrels daily, mainly due to lower demand in the third quarter of 2025.
Total world oil demand is expected to reach 106.9 million barrels per day in the fourth quarter of 2025 and 105.3 million barrels per day over the course of the year.
Other Commodities
In other commodity markets, December copper futures on MCX were priced at ₹833.15, up by 0.43% from the previous close of ₹829.55. On the National Commodities and Derivatives Exchange (NCDEX), December dhaniya (coriander) futures were at ₹7798, up 0.33% from the previous close of ₹7772, while January guargum futures traded at ₹10175, up 0.37% from the previous close of ₹10137.
Conclusion
Crude oil prices are facing volatility as geopolitical tensions, particularly sanctions on Russia, continue to weigh on the market. Supply risks, combined with fluctuating demand forecasts, are contributing to uncertain market conditions. The outlook for 2025 suggests further volatility as global demand and geopolitical factors evolve.
