The Impact of U.S. Sanctions on Global Oil Dynamics

Mr. Choeib Boutamine

July 25, 2025

The sanctions of the European Union and the U.S. on Russia mainly affect the EU economy, as many European countries still depend on Russian natural gas.
EU countries are expected to reach 90% gas storage levels, and limiting Russian supplies could make that goal hard to achieve.

U.S. President Donald Trump allowed a 50-day negotiation period with Russia. If these negotiations don’t lead to progress, more sanctions may be imposed. The biggest loser due to these sanctions is not only Russia, but mainly the European Union.

In April, the U.S. introduced tariffs, but they did not include oil. Now, the U.S. has hinted that oil could be part of the next round of tariffs.
President Trump recently threatened Brazil with a 50% tariff by August. Brazil exports around 230,000 barrels of oil, the same amount as Kurdistan, and if tariffs are placed on Brazil, Kurdistan could balance the market by supplying the same volume.

OPEC+ decided to add 548,000 barrels per day in August, making 1.92 million barrels available; however, the organization still has a spare capacity of 4 million barrels, and the U.S. is aware of this.

Mr. Boutamine says OPEC may add another 500,000 barrels in September, but it’s wiser to wait, because on August 1st the U.S. will decide whether to impose a 30% tariff on the EU and Mexico. Then, on August 3, OPEC will meet. The smart move for OPEC is to wait until September 5 to see if the U.S. moves forward with new sanctions on Russia.