WTI crude oil traded between a high of $68.34 and low of $64.11 before reaching $66.28 as of Thursday’s close, down $0.86 or -1.28%.
The price action reflected competing fundamental forces: escalating geopolitical tensions that initially supported prices, followed by trade policy uncertainties and mixed inventory data that pressured the market lower.
Geopolitical Tensions Drive Early Week Strength
The period began with significant geopolitical risk as President Trump prepared statements on Russia with direct oil supply implications. Trump confirmed plans to send Patriot missile systems to Ukraine, while bipartisan Congressional momentum drove new sanctions legislation aimed at pressuring Russia into peace talks.
European Union diplomats neared consensus on an 18th round of sanctions targeting Russian crude, potentially with a lower price cap. Markets initially priced in supply constriction risks, providing early bullish support.
However, the geopolitical premium faded when Trump announced a 50-day deadline to end the Ukraine war. UBS analyst Giovanni Staunovo noted this delay reduced expectations of immediate market tightening, leading to a retreat from Monday’s three-week high of $69.65.
Iraq Supply Disruptions Provide Persistent Support
Iran-backed militias conducted drone attacks on Iraq’s Kurdistan region for four consecutive days, forcing production shutdowns at oilfields operated by Gulf Keystone, DNO, and Hunt Oil.
