Oil prices exhibited minimal fluctuations on Wednesday, following a decline in the preceding session, as market participants anticipate significant new U.S. tariffs on India, the globe’s third-largest crude consumer, in reaction to its acquisitions of Russian supply. The United States is poised to implement further tariffs of 25% on exports from India, effective at 12:01 a.m. EDT (0401 GMT) on Wednesday. This action will elevate the total tariff rate to 50%, positioning it among the highest rates imposed by the U.S. government. U.S. President Donald Trump has indicated that the elevated charges stem from India’s procurement of Russian oil, which surged in the aftermath of Russia’s invasion of Ukraine, as Western sanctions prompted Russia to offer its cargoes at discounted rates.

Brent crude futures experienced a modest increase of 2 cents, reaching $67.24 per barrel at 0133 GMT, whereas West Texas Intermediate (WTI) crude futures remained unchanged at $63.25. Both contracts experienced a decline of over 2% on Tuesday, following a strong start to the week that saw them reach a two-week high. “Investors remain on edge as additional tariffs on India in response to its purchases of Russian crude hang over the market,” said Daniel Hynes, senior commodity strategist at ANZ, in a note on Wednesday.

Indian refiners initially reduced their acquisitions of Russian crude in response to the U.S. tariff announcements and subsequent stricter European Union sanctions affecting the Russian-backed Indian refinery Nayara Energy. State-owned refiners Indian Oil and Bharat Petroleum have recommenced their procurement of Russian supplies for the months of September and October, according to company sources reported last week. Indian Oil, the largest refiner in the nation, has indicated that its procurement of Russian crude will be contingent upon economic considerations. This situation has prompted certain analysts to scrutinize the extent of influence that elevated U.S. tariffs will exert on Indian procurement activities.

“The secondary tariff has not been sufficient to deter India from purchasing Russian oil.” According to Warren Patterson, head of commodity strategy at ING, “The market will be watching Russian oil flows to India closely going forward to gauge the impact, if any, of secondary tariffs.” The ongoing conflict in Ukraine is exerting pressure on the oil market through various channels, notably as Ukrainian drone strikes target Russian refineries, thereby disrupting their operations and compelling them to export the crude oil that exceeds their processing capacity. Russia has adjusted its crude oil export strategy from western ports, increasing the planned volume by 200,000 barrels per day for August, following recent attacks, according to three individuals with knowledge of the situation who spoke on Tuesday.