Oil prices rebounded from the previous session's five-week low on Wednesday, as traders focused on US President Donald Trump threatening India with higher tariffs over its Russian crude purchases, and a larger-than-expected US crude draw.
Brent crude futures gained $1.11, or 1.6%, to $68.75 a barrel by 1119 GMT, while US West Texas Intermediate crude was up $1.12, or 1.7%, at $66.28 a barrel.
Both oil contracts fell by more than $1 on Tuesday to settle at their lowest in five weeks, marking a fourth session of losses.
"Prices bounced up on the potential higher tariffs on India but the market is waiting for some sort of a formal implementation as well as which elements in the market are to be affected," said Rystad analyst Janiv Shah.
Trump renewed threats to impose higher import tariffs on Indian goods over the country's buying of Russian energy. India, along with China, is a major buyer of Russian oil, Reuters reported.
"Expectations appear that India may reduce its buying of Russian crude, but I can't see them doing so entirely as they have been making supernormal profits on buying cheap Russian crude," said Ashley Kelty, an analyst at Panmure Liberum.
US envoy Steve Witkoff arrived in Moscow on Wednesday on a last-minute mission to seek a breakthrough in the Ukraine war, two days before the expiry of a deadline set by Trump for Russia to agree to peace or face new sanctions.
Rystad's Shah said that although the meeting could lead to some concessions, a planned supply increase from the OPEC+ group would offset a potential decline in Russian oil supply.
The market was also finding support from a fall in US crude inventories last week, analysts said, as sources citing American Petroleum Institute figures said on Tuesday that stockpiles had fallen by 4.2 million barrels.
That compares with a Reuters poll estimate of a 600,000 barrels draw for the week to August 1.
"For all that has been thrown the oil market's way geopolitically, Brent futures have struggled to even hold the floor at $70 a barrel for any convincing length of time," said independent analyst Gaurav Sharma.
Brent is down 9.4% so far this year, which Sharma said was due to the market remaining well supplied at a time of uncertain demand. That, along with a cloudy macro-economic outlook, made the case for any lasting bullishness in crude unlikely, he added.
