Key points
- Brent fell $2.29 to $107.57 and WTI fell $1.95 to $99.46 on Monday.
- Trump waived Russia sanctions and tariffs, but Rubio says a 60-day review will follow.
- Gulf crude flows fell to about 8.5 million barrels a day from over 20 million.
Oil prices slipped from a five-month high on Monday as investors took profits after US President Donald Trump waived sanctions and tariffs on Russia that may lead to more Russian fuel exports.
Brent crude futures fell $2.29, or 2.08%, to $107.57 a barrel by 0619 GMT, after settling Friday at its highest since May 19. US West Texas Intermediate was at $99.46, down $1.95, after closing at its highest since Sept. 17. Brent briefly touched $110 on Friday for the first time since May.
The Russia waiver
Trump signed an executive order Friday waiving key sanctions and tariffs under the Graham Act, which he signed last month at lawmakers’ urging to pressure Moscow over Ukraine.
However, Secretary of State Marco Rubio said the president will take up to 60 days to assess the economic impact.
The waiver follows a deal with Russian President Vladimir Putin to export diesel to the United States and other countries, starting at about 2.3 million barrels this month and rising to about 7.6 million monthly. Ukrainian President Volodymyr Zelenskiy said the moves will hurt Ukraine.
Analysts were skeptical. “Until the details and duration are clearer, the market is unlikely to fully price in a sustained increase in supply,” said Tim Waterer of KCM Trade.
Priyanka Sachdeva of Phillip Nova called it “another desperate attempt to keep oil prices in check” ahead of the midterms.
Hormuz disruption persists
Intensified attacks on commercial vessels cut Gulf crude flows to about 8.5 million barrels a day on a seven-day average last week, from more than 20 million the week before, Kpler said.
It counted at least 10 confirmed incidents. Meanwhile, Egypt said it is ready to support Saudi Arabia against Yemen’s Houthis.
DBS expects prices to stay between $100 and $110 into the midterms, with Russia waivers offering only short-term relief.
