Oil Futures Hit 7-Week High On Russia Woes, U.S. GDP

SECAUCUS, NJ (DTN) – Oil prices had their biggest weekly gain in three months, hitting seven-week highs Friday (9/26), as sanctions pressure built on Russia, which also cut its fuel exports after domestic shortages caused by Ukrainian strikes on its infrastructure.

Better-than-expected second-quarter U.S. GDP data released Thursday (9/25) also bolstered oil’s gains for the week.

In crude oil, NYMEX-traded WTI for November delivery settled up $0.74 at $65.72 bbl, after soaring at one point to $66.42, its highest since early August. For the week, WTI rose 4.5% — its largest weekly gain since July.

 ICE Brent for November delivery gained $0.67 to $70.09 bbl, after a seven-week high at $70.77. For the week, Brent gained about 5%, its biggest weekly win since June.

Among oil products, October RBOB gasoline futures rose $0.0354 to $2.0376  gallon, and the front-month ULSD contract edged higher $0.0024 to $2.4289 gallon.

Oil’s rally through the week was largely fueled by a drastic and unexpected shift in U.S. foreign policy toward Russia.

This policy reversal originated in the White House, which had, only a month prior, signaled a willingness to push Ukraine toward territorial concessions to achieve a swift peace settlement with Russia. However, in an abrupt turn on Tuesday (9/23), U.S. President Donald Trump publicly declared that Ukraine must reclaim all territory occupied by Russian forces.

Trump coupled this stance with sharp criticism aimed at countries he claimed were funding Russia’s war efforts. He called out India and China for their continued oil purchases and reiterated his call for European allies to cease energy imports, intensify sanctions and increase financial support for Kyiv. 

The U.S. campaign against Russia expanded on Thursday (9/25) when Trump urged Turkish President Recep Tayyip Erdogan to adopt similar measures.

Simultaneously, Ukraine has been escalating its attacks on critical Russian oil infrastructure. While the full scope of the damage remains unclear, the impact on domestic fuel supply was severe enough for Deputy Prime Minister Alexander Novak to impose an immediate ban on diesel exports until the end of the year. 

Novak also extended an existing prohibition on Russian gasoline exports, a move that further tightened supplies and drove up prices. This affected particularly the European market, where inventories of middle distillates were already constrained.

Offsetting some of this week’s gains were signs that 230,000 bpd of Iraqi supply from the northern territory of Kurdistan may be on the verge of returning to the market. Impacted oil producers have presented a framework to relevant authorities to resume exports stalled since 2023.