Oil prices rebounded on Wednesday from a five-week low recorded in the previous session as investors weighed U.S. crude inventory data and renewed geopolitical risks tied to India’s purchases of Russian crude.
Brent crude oil, against which Nigerian crude oil is priced, rose by 90 cents or 1.3 percent to $68.54 a barrel as of 10:36 in Nigeria. U.S. West Texas Intermediate (WTI) crude gained 92 cents, or 1.4 percent to $66.08 per barrel.
The gains followed four consecutive sessions of losses that drove both contracts to their lowest settlement in more than a month.
The rebound came after the American Petroleum Institute (API) reported a larger-than-expected draw in U.S. crude inventories.
Stockpiles fell by 4.2 million barrels for the week ending August 1, compared with market expectations of a 600,000-barrel decline.
“API data showing a significant U.S. crude draw yesterday was price supportive,” said Giovanni Staunovo, analyst at UBS. “Markets are also factoring in the geopolitical risk premium tied to Washington’s latest warnings to India.”
U.S. President Donald Trump on Tuesday threatened India with higher tariffs in response to its continued imports of discounted Russian crude.
India, alongside China, remains one of the largest buyers of Russian oil, with analysts warning that even a partial reduction in purchases could reshape supply flows across Asia.
“Oil prices are higher today as traders look to India and China’s response to the threat of secondary sanctions,” noted Ashley Kelty, analyst at Panmure Liberum. “Expectations are that India may scale back some purchases, but complete withdrawal seems unlikely given the significant profits from discounted Russian crude.”
In a related development, U.S. envoy Steve Witkoff arrived in Moscow on Wednesday on a last-minute mission to seek a breakthrough in the Ukraine conflict.
The visit comes ahead of a deadline set by Trump for Russia to agree to peace terms or face a new round of sanctions.
Market analysts at Roth Capital Markets warned that uncertainty over the outcome of these talks will likely keep oil prices supported in the short term.
“Overall, the outlook for the Russia-Ukraine war remains uncertain, but the threat of escalating tariffs and continued conflict is likely to underpin prices until there is clarity on the impact of sanctions,” Roth Capital stated in a note.
Despite the geopolitical tensions, some analysts believe disruption to Russian exports will be limited as China is expected to absorb the majority of shipments.
Nevertheless, traders remain cautious, with supply risks from U.S.-India trade friction adding to market volatility.
The recent uptick follows steep declines earlier in the week, when Brent and WTI each lost more than $1 in a session marked by concerns over weakening global demand and resilient Russian exports. With the latest API figures and heightened political risk, analysts expect crude markets to hold steady in the near term.
