US sanctions against Russia postponed for now - Commerzbank

Yesterday, the price of Brent crude oil climbed above $71 per barrel for the first time since the attacks between Israel and Iran, Commerzbank's commodity analyst Barbara Lambrecht notes.

Russia's oil exports have already weakened

"One reason for this were China's strong crude oil imports (see below), the other was US President Trump's announcement of a 'major statement' on further action against Russia. Tighter sanctions were feared. Ultimately, Trump gave Russia 50 days to end the war. Otherwise, punitive tariffs of 100% would be imposed on Russia's allies."

"Secondary sanctions would threaten buyers of Russian oil, primarily China and India. The announcement was met with relief. On the one hand, the feared (short-term) shortage of oil supplies due to new immediate sanctions has been averted. On the other hand, the threat is so massive that it is only credible to a limited extent. The price of Brent crude oil slipped back below $70 per barrel."

"However, it should be noted that Russia's oil exports have already weakened, according to the IEA. At 7.23 million barrels per day, oil exports marked the lowest June-Level since 2021. This raises the question of whether Russia can maintain its production capacity."