WTI posts modest gain above $65.00 on rising supply concerns
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WTI price trades with mild gains near $65.30 in Wednesday’s early Asian session.
The ongoing Russia-Ukraine conflict led to worries over supply-side disruptions among oil traders, supporting the WTI price.
Heightened US tariffs on Indian goods raise concerns about weaker demand, which might cap the WTI’s upside.
West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $65.30 during the early Asian trading hours on Wednesday. The WTI edges higher as concerns over supply disruptions increased following strikes on Russian energy sites by Ukraine in the ongoing Russia-Ukraine war.
Ukrainian President Volodymyr Zelenskyy said that the country intends to strike deep into Russia following a large Russian drone attack that left 60,000 Ukrainians without electricity. According to Reuters calculations, Ukrainian drone attacks have shut down facilities accounting for at least 17% of Russia's oil-processing capacity, or 1.1 million barrels per day. Concerns that intensifying airstrikes in Russia and Ukraine could lead to supply disruptions might boost the WTI price.
US President Donald Trump threatened to impose additional sanctions on Russia if no progress is made in peace talks with Ukraine. Trump further stated that he would intervene as a third party if necessary.
On the other hand, Trump’s doubling of the existing 25% duty on Indian exports raises fears of slowing trade and weaker global demand, which could weigh on the WTI price. The Trump administration imposed the additional tariff to penalize India for buying discounted Russian oil, arguing it indirectly funds Russia's war in Ukraine.
Oil traders will keep an eye on the release of the American Petroleum Institute (API) weekly crude oil stock, which will be published later on Wednesday. The attention will shift to the US Nonfarm Payrolls (NFP) report for August later on Friday. In case of the stronger-than-expected outcome, this could lift the US Dollar (USD) and drag the USD-denominated commodity price lower.
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