Oil prices eased in Asian trading on Thursday, as investors balanced the effects of a slightly larger-than-expected U.S. crude inventory draw with the implementation of new tariffs on imports from India.
As of 21:34 ET (01:34 GMT), October Brent futures fell 0.5% to $67.71 per barrel, while West Texas Intermediate (WTI) futures slipped 0.6% to $63.80 per barrel.
U.S. Crude Stocks Drop More Than Anticipated
According to the Energy Information Administration, U.S. crude inventories fell by 2.4 million barrels in the week ending August 22, exceeding analysts’ expectations of a 1.9 million-barrel decline. Gasoline inventories dropped 1.2 million barrels, and distillates fell 1.8 million barrels. Meanwhile, implied gasoline demand rose to 9.24 million barrels per day from 8.84 million bpd a week earlier, indicating strong seasonal consumption.
While the draw reflects robust end-of-summer driving, it also raises concerns that demand could slow once the seasonal peak ends, potentially squeezing refining margins and limiting the upside for oil prices.
Market Eyes 50% U.S. Tariff on India
Investors are also digesting the impact of U.S. tariffs on India. In response to India’s continued imports of Russian crude, an additional 25% duty on Indian oil imports came into effect Wednesday, doubling the total U.S. tariff to 50% from August 27.
Although Indian refiners paused purchases of Russian oil briefly after the secondary tariffs were imposed, they have since resumed imports, suggesting that the measures have not significantly curtailed flows. Analysts expect markets to continue monitoring Russian crude shipments to India to gauge potential effects.
Geopolitical tensions remain a key driver of sentiment. U.S. President Donald Trump has positioned himself as a mediator in the Ukraine conflict but warned last week that additional sanctions on Moscow could be imposed if progress toward a peace deal is not made within two weeks.
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