Oil prices rebounded by around 1 per cent in early trade on Thursday, supported by comments from US President Donald Trump that Indian Prime Minister Narendra Modi has promised to stop purchasing oil from Russia.
The move could have significant implications for global crude supply, given that Russia currently accounts for about one-third of India’s total oil imports, reported Reuters.
Brent crude futures gained 57 cents, or 0.9 per cent, to reach $62.48 a barrel in early trade today. Similarly, US West Texas Intermediate (WTI) futures climbed 54 cents, or 0.9 per cent, to $58.81 per barrel.
Both benchmarks had touched their lowest levels since early May during the previous session, amid mounting concerns over US-China trade tensions and warnings from the International Energy Agency (IEA) of a potential global oil surplus in 2026.
India’s Shift from Russian Oil Purchases
Trump’s remarks came on Wednesday, revealing that India would cease buying oil from Russia, its top energy supplier. The US President also stated that Washington aims to persuade China, another major buyer of Russian crude, to follow suit.
This move aligns with the US-led efforts to cut Moscow’s energy revenues and intensify pressure on Russia to engage in peace negotiations over its conflict in Ukraine.
India and China are currently the largest importers of Russian seaborne crude, which remains under sanctions by both the US and European Union. For months, Prime Minister Modi’s administration had defended these purchases, citing national energy security concerns and the need to maintain affordable oil supplies amid global price volatility.
According to market analyst Tony Sycamore from IG, India’s decision could lend short-term support to crude markets. “At the margin, this is a positive development for the crude oil price as it would remove a big buyer (India) of Russian oil,” Sycamore said.
Traders Await US Inventory Data
Investors are now turning their attention to the weekly oil inventory report from the US Energy Information Administration (EIA), due later on Thursday. This follows mixed data from the American Petroleum Institute (API), which reported an increase in crude and gasoline stocks but a decline in distillate inventories last week.
According to market sources, US crude inventories rose by 7.36 million barrels in the week ending October 10, while gasoline stocks climbed by 2.99 million barrels. Meanwhile, distillate inventories, which include diesel and heating oil, fell by 4.79 million barrels compared with the previous week.
While the decline in distillate stocks indicates stronger diesel demand, the rise in crude and petrol inventories suggests a slowdown in fuel consumption in the world’s largest oil market. Analysts forecast that US crude stockpiles likely rose by around 0.3 million barrels last week, reflecting persistent caution among refiners and consumers amid economic uncertainty.
