Onome Amuge
Oil prices edged lower on Thursday, reversing some of the prior session’s gains, as investors weighed expectations of weaker U.S. fuel consumption at the end of the summer driving season against the resumption of Russian crude flows to central Europe.
Brent crude, the international benchmark, fell 23 cents, or 0.3 per cent, to $67.82 a barrel, while U.S. West Texas Intermediate (WTI) futures lost 28 cents, or 0.4 per cent, to trade at $63.87. Both benchmarks had rallied nearly one per cent on Wednesday after U.S. government data showed crude stockpiles declined more than expected, suggesting still-robust demand.
Analysts, however, said the outlook for September was less supportive. “The mismatch between rising supply and falling seasonal demand will be weighing on energy futures across the spectrum as summer turns into fall,” said consultancy Ritterbusch and Associates. Refiners are expected to scale back output of gasoline, switching instead to cheaper winter-grade products, just as OPEC+ prepares to lift production targets by 547,000 barrels per day from September.
The restart of Russian oil supplies to Hungary and Slovakia through the Druzhba pipeline, after a brief outage caused by a Ukrainian attack inside Russia last week, also helped ease concerns about disruptions in Europe. Hungarian oil group MOL and Slovakia’s economy minister confirmed that flows had resumed on Thursday, restoring a key artery of crude deliveries to the region.
Traders are closely monitoring India’s response to growing geopolitical pressures. President Donald Trump this week doubled tariffs on Indian imports to as high as 50 per cent, part of his broader hardline trade strategy. Washington has also pressed New Delhi to curb purchases of discounted Russian crude, though analysts expect little immediate change.
“India is expected to continue purchasing crude oil from Russia at least in the short term, which should limit the impact of the new tariffs on global supply,” said Tony Sycamore, market analyst at IG.
Meanwhile, conflict-driven risks remained in focus. Ukraine reported that Russia had launched one of its largest recent drone strikes on energy infrastructure, targeting six regions and leaving more than 100,000 people without power. Kyiv has also stepped up attacks on Russian facilities in recent weeks, raising fears of further disruptions to supply routes.
Despite Thursday’s dip, traders said volatility was likely to persist as supply gains from OPEC+ clashed with geopolitical tensions and the shifting dynamics of U.S. demand. With the summer travel season drawing to a close, attention is turning to whether autumn stock builds will cap prices or whether conflict-driven shocks could reignite a rally.
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