Russia Freeze Raises Oil Price

 10/24/2025

 

Oil Price Advances on Russian Freeze

 

President Trump now sanctions Russia’s largest oil producers, Rosneft and Lukoil. This means there are penalties for any third country buying oil from the Russian producers. The success of this strategy will depend on three things

=the success of their enforcement

-the reaction of India and China, both big buyers of Russian oil

- whether Putin can walk around the sanctions as he has so far.

Last week we observed that oil prices were at a crossroads. Price had fallen below $60. It appeared headed to $55. Then the sanctions were announced. West Texas Intermediate shot up, now trading at $62.18.

This news has spilled Wall Street. Bell weather Apache APA jumped $2.

Conoco Phillips COP jumped from $87 to $90.  Halliburton HAL soared from $22.50 to $27.22.  Transocean RIG moved from $3.30 to $3.90.  Refiner Valero VLO rose 7% Thursday.

The expectation will be for much higher oil prices in the next year.

The stock market has risen above 47,000 once again. This suggests higher index prices ahead. Corporate earnings are encouraging buying stocks.

It is amazing what companies can do when allowed to produce products that consumers want. GM and Ford F have backed off from their Obama/Biden enforced love affair with Electric Vehicles. They are returning to what they do best, make pick-ups and large SUVs. Revenue has soared at both companies.  GM stocks in two days jumped from $58 to $66. Ford F for whatever reason remains mired in the $12 area as it has for years.

Gold spiked to around $4,350 and then retreated. It trades this morning at $4,1585.  Silver topped around $53.24 and now trades at $47.64. The top price for both appears to be at hand.  Expect a prolonged period of price consolidation for the metals. 

The rate of inflation has slowed but it is still with us. Yesterday I paid $17.12 at a national deli chain. That bought me a half sandwich, a cup of soup, and iced tea.  That is expensive for a simple lunch. Wall Street expects more FED inrerest rate cuts. If in fact oil prices rise as I expect,  Jerome and the FED governors will have a hard time justifying lower rates. 

 

dennis.elam@att.net