Crude Oil Prices Drop as US Issues 50-Day Deadline to Russia

Crude oil prices fell on Tuesday after the United States issued a 50-day deadline to Russia to stop the conflict in Ukraine. The market reacted with caution, and prices moved slightly lower in early trading.

By 9:55 a.m., Brent oil futures for September were at $68.87, down 0.49%. West Texas Intermediate (WTI) futures for August were at $66.59, down 0.58%. On India’s MCX exchange, July crude oil futures traded at ₹5,728, down 0.75%, while August futures dropped 0.77% to ₹5,649.

Tariff Threats Create Uncertainty in Oil Market

On Monday, the US president announced plans to send more weapons to Ukraine. At the same time, he warned of new sanctions on countries that continue to buy oil from Russia. If no ceasefire is agreed upon within 50 days, the US may apply 100% tariffs on Russian oil exports.

Despite the strong message, markets did not react sharply. Experts from ING said oil traders were waiting to see if the US would really follow through on its threats. They believe the delay in action and doubts about enforcement helped keep prices stable.

What Happens If Sanctions Are Enforced?

Russia exports more than seven million barrels of crude oil and refined products every day. Its biggest buyers are China, India, and Turkey. If these countries face heavy tariffs on their exports to the US, they may reduce purchases from Russia.

This could create a large shortage in the global oil supply. Experts warn that OPEC cannot fully make up for that shortfall. If the US enforces these new rules, crude oil prices could rise quickly. However, analysts also believe the US may not follow through, since higher oil prices would hurt American consumers.

Commodity Prices in Other Markets

In other commodity news:

• Natural gas for July was trading at ₹295.90 on the MCX, down 1.23%
• Guargum contracts for July rose 1.43% to ₹9,759 on NCDEX
• Cottonseed oilcake fell slightly by 0.26% to ₹3,055

What to Watch Next

The oil market remains sensitive to political developments. If the 50-day deadline passes without progress, crude oil prices could shift sharply. Until then, traders are likely to stay cautious.

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