Asian Trading Gains

Oil prices rose modestly in Asian trade on Monday, extending last week’s gains, as markets balanced potential supply disruptions from Russia with signs of weakening U.S. demand. Brent crude futures for November delivery climbed 0.4% to $67.26 per barrel, while West Texas Intermediate futures added 0.5% to $62.72 by 02:15 GMT.

Russia-Ukraine Conflict Keeps Supply Risks Elevated

Crude benchmarks gained about 1% last week after Ukraine intensified strikes on Russia’s energy infrastructure, targeting the Primorsk export terminal and the Kirishinefteorgsintez refinery. These facilities are critical for Moscow’s oil flows, particularly to top customers India and China, raising fears of possible export disruptions.

Geopolitical risks were further amplified after Moscow signaled that ceasefire talks with Kyiv had stalled, while Western nations mulled harsher restrictions on Russian oil purchases. The U.S. has already urged G7 partners to increase tariffs on China and India, following Washington’s decision in late August to impose 50% tariffs on Indian oil imports linked to Russian supply.

Fed Rate Cut in Focus

The Federal Reserve’s policy meeting this week has also been a key driver of commodity sentiment. Weak U.S. labor market readings combined with mixed inflation data have reinforced expectations that the Fed will cut interest rates on September 17.

Markets now see a 96.4% probability of a 25-basis-point reduction and a 3.6% chance of a 50-basis-point cut, according to CME FedWatch. Lower borrowing costs typically support economic activity, which in turn can boost oil demand.

Dollar Weakness Supports Commodities

The U.S. dollar weakened on growing bets of Fed easing, reducing the cost of commodities priced in the greenback and helping crude retain gains despite demand concerns.

Outlook

While supply risks from Russia and the Middle East lend support to oil, lingering fears of oversupply and softer U.S. demand continue to cap gains. Traders are now watching both the Federal Reserve’s policy decision and further developments in the Russia-Ukraine conflict for the next cues on price direction.