Oil prices rebounded during Wednesday's Asian session following U.S. President Donald Trump’s threats of new tariffs on India over its continued purchases of Russian crude, heightening concerns over potential supply disruptions.
By 3:25 pm AEST (4:25 am GMT), Brent crude futures rose 43 cents, or 0.6%, to $68.07 per barrel, while U.S. West Texas Intermediate (WTI) crude was up 10 cents, also 0.6%, to $65.57 per barrel.
The gains followed declines on Tuesday, when both benchmarks fell more than $1, settling at five-week lows and marking a fourth consecutive session of losses.
The decline was driven by oversupply concerns stemming from OPEC+’s decision to increase production.
The producer group, which includes members of the Organization of the Petroleum Exporting Countries (OPEC) and its allies, agreed on Sunday to raise output by 547,000 barrels per day in September, effectively ending their latest round of supply cuts ahead of schedule.
OPEC+ accounts for nearly half of global oil output and had been limiting production in recent years to support prices, but this year the group has accelerated output to regain market share.
Meanwhile, geopolitical tensions added to volatility after Trump issued fresh warnings to India over its purchases of Russian oil, suggesting higher tariffs on Indian goods could be imposed within 24 hours.
Trump’s remarks follow efforts by Washington to restrict Russian oil revenues and push for a peace deal with Ukraine, potentially forcing India to seek alternative energy suppliers. This could redirect Russian oil flows, disrupting global supply chains.
India dismissed Trump’s comments as “unjustified” and pledged to safeguard its economic interests, escalating an already tense trade relationship between New Delhi and Washington.
On the supply side, U.S. crude inventories fell by 4.2 million barrels last week, according to sources citing data from the American Petroleum Institute, far exceeding market expectations of a 600,000-barrel draw.
The U.S. Energy Information Administration is scheduled to release official inventory figures later on Wednesday.