Oil prices are going up as the United States tries to get the Group of Seven (G7) countries to impose tariffs up to 100% on India and China for buying Russian oil. This plan may face challenges because of rising tensions between the US and its trading partners. Countries in the European Union, like Hungary, are opposing the US proposal. Hungary has previously blocked stricter sanctions on Russia’s energy sector.

Oil Prices Surge

After the news about the tariff proposal, oil prices jumped by $1.19 to $63.57. This increase shows how these tariffs could affect the global oil market. Oil is currently priced at $63.57, responding to the proposed US tariffs on Russian crude buyers. The uncertainty over whether the G7 will support this plan is adding volatility to the market. Traders should brace for larger price swings in the next few weeks as diplomatic discussions continue. This price is still relatively low compared to the highs seen in 2022 and 2023, when crude often exceeded $80 per barrel. The earlier G7 strategy involved a price cap, which had mixed results, but this new 100% tariff proposal is much more aggressive. The market is now assessing whether this threat is genuine or just political maneuvering.

Traders Adjust Strategies

For those anticipating the tariffs will happen, it may be a good time to buy call options. Recent data from August 2025 showed that Russian oil exports to India and China remained strong, averaging 2.2 million barrels per day. Removing that supply from the market would likely push prices closer to $70. However, we must also consider the strong opposition from countries grappling with inflation, which averaged 2.9% in the G7 last quarter. The memory of the 2022 energy crisis in Europe is still fresh, and nations like Hungary could easily block this move to avoid rising energy costs again. Traders who think the proposal will fail may see this as a chance to buy put options, betting that prices will drop once diplomatic challenges become too great. Create your live VT Markets account and start trading now.

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