Oil prices declined for a third consecutive session on Tuesday as investors weighed the impact of new U.S. sanctions on Russia’s top oil producers and signals of a possible OPEC+ output increase.
Brent crude oil, against which Nigerian crude oil is priced, fell 2 percent to $64.33 per barrel, while U.S. West Texas Intermediate (WTI) dropped 2 percent to $60.11 per barrel as of 09:56 a.m. in Nigeria.
The decline follows last week’s rally, which saw both benchmarks record their strongest weekly gain since June after the United States imposed sanctions on Russian oil giants Lukoil and Rosneft for the first time in President Donald Trump’s second term.
Analysts said market participants are adjusting to the sanctions news and reassessing how much disruption, if any, it will cause to Russian crude exports. UBS analyst Giovanni Staunovo noted that the market is “reducing the supply risk premium” built into prices last week amid uncertainty over how effective the restrictions will be.
The International Energy Agency (IEA) stated that the effect of sanctions on global oil exports could be limited due to available spare capacity among producers, particularly within OPEC+.
Following the U.S. measures, Lukoil announced plans to divest its international assets — a major development for Russia’s oil sector as Western restrictions continue to pressure its overseas operations.
In addition, Indian refiners have paused new Russian oil purchases pending clarification from authorities and suppliers on the implications of the sanctions.
Meanwhile, OPEC+ — comprising members of the Organization of the Petroleum Exporting Countries and allies including Russia — is reportedly considering a modest output increase in December, according to sources familiar with the group’s discussions.
The alliance began gradually reversing previous production cuts in April to stabilize supply.
The prospect of higher output, combined with lingering concerns over demand growth, has exerted fresh pressure on oil prices this week.
Traders are also monitoring developments in global trade as U.S. President Donald Trump and Chinese President Xi Jinping are set to meet in South Korea on Thursday.
The outcome of these discussions could influence the outlook for global energy demand, as the United States and China remain the world’s largest oil consumers.
Energy analysts said oil markets are likely to remain volatile in the near term as investors balance geopolitical risks with potential supply increases and the uncertain trajectory of global demand.