Brent oil futures climb 2% as Russia flows, U.S. policies in focus

Oil prices gained crushed connected Tuesday, arsenic Ukraine warfare escalations raised questions implicit the resilience of Russian supplies, portion uncertainty lingers implicit the interaction of Washington's policies connected cardinal lipid consumers.

Brent futures with November expiry were astatine $69.46 per tube astatine 10:54 a.m. London clip ( 5:54 a.m. E.T.), up 1.92% from the Monday close.  

The front-month October Nymex WTI declaration was trading astatine $65.97 per barrel, higher by 3.06%. WTI futures did not settee connected Monday due to the fact that of the U.S. Labor holiday.

Moscow and Kyiv person ramped up occurrence exchanges successful their three-and-a-half-year conflict, with Reuters calculations pointing to Ukrainian drone attacks shutting down facilities accounting for astatine slightest 17% of Russia's lipid processing capacity. CNBC could not independently verify the report.

Ukrainian President Volodymyr Zelenskyy vowed "new heavy strikes" against Russia successful a social media station implicit the weekend, without disclosing details. His pledge comes amid stalling U.S. and European efforts to gully Kremlin person Vladimir Putin into conceding to bilateral ceasefire talks with his Ukrainian counterpart.

The White House has separately piled connected indirect unit connected Russia's lipid consumers, implementing further levies connected imports of Indian goods it attributed to New Delhi's ongoing purchases of Moscow's crude. India has criticized the impositions arsenic "unfair, unjustified and unreasonable."

In a further motion of deteriorating relations, U.S. President Donald Trump connected Monday doubled down connected lambasting Washington's commercialized ties with India arsenic a "totally 1 sided disaster."

Critically, Washington has yet to determination against China, the world's largest crude importer and Russia's biggest lipid purchaser since the instauration of G7 sanctions. Putin, Chinese President Xi Jinping and Indian Prime Minister Narendra Modi met astatine this week's Shanghai Cooperation Organization (SCO) summit, successful a amusement of Global South unity.

Also connected the proviso side, lipid investors are looking retired for output argumentation signals from an eight-member subset of the OPEC+ confederation – comprising heavyweights Russia and Saudi Arabia, alongside Algeria, Iraq, Kazakhstan, Kuwait, Oman and the United Arab Emirates – which are owed to deliberate imaginable accumulation steps connected Sept. 7. The group, which precocious expedited unwinding a 2.2-million-barrels-per-day accumulation cut, is wide seen arsenic improbable to alteration people connected strategy this week.

"We believe, conscionable similar the broader market, that the radical volition permission accumulation levels unchanged for October," ING analysts said Tuesday. "The standard of the surplus done adjacent twelvemonth means it's improbable the radical volition bring further proviso onto the market. The bigger hazard is OPEC+ deciding to reinstate proviso cuts, fixed concerns astir a surplus."