Oil prices rise as markets weigh Russia supply risks and Fed decision
Oil prices edged higher on Tuesday, extending gains from the previous session. Traders focused on the risk of supply disruption from Russia after Ukrainian drone strikes on refineries, as well as the upcoming U.S. Federal Reserve interest rate decision.
Brent crude futures rose 8 cents to $67.52 a barrel by 06:32 GMT, while U.S. West Texas Intermediate (WTI) gained 11 cents to $63.41. On Monday, Brent closed up 45 cents at $67.44, and WTI finished 61 cents higher at $63.30.
Ukraine has stepped up attacks on Russia’s energy infrastructure to weaken Moscow’s war capacity, with analysts warning that strikes on facilities such as the Primorsk export terminal could impact global oil flows. According to JP Morgan, such moves suggest a greater willingness to disrupt international markets, potentially adding upside pressure to prices.
At the same time, U.S. Treasury Secretary Scott Bessent said Washington would not impose new tariffs on Chinese goods to discourage Russian oil purchases unless European nations also placed duties on China and India.
Markets are also awaiting the outcome of the Federal Reserve’s September 16–17 meeting, where policymakers are widely expected to cut interest rates. Lower borrowing costs usually support fuel demand, but analysts remain cautious about the broader U.S. economy.
Kelvin Wong, senior analyst at OANDA, noted that the rebound in oil prices since early September has been “shaky,” citing weaker U.S. consumer data and concerns over demand. He added that if the Fed cuts its GDP growth outlook for 2026–2027 and lowers its Fed funds rate projection to 2%, oil demand could face additional pressure.
Meanwhile, crude inventory data is also in focus. U.S. stockpiles likely fell by 6.4 million barrels last week after a 3.9 million build the week before, according to Macquarie’s Walt Chancellor. A Reuters poll similarly forecast declines in crude and gasoline stocks, though distillate inventories were expected to rise.
