Oil Prices Forecast as India Drops Russian Oil Under U.S. Deal

U.S. President Donald Trump on Monday said the United States has reached a new trade agreement with India, marking a potential thaw in relations after a year of tariff hikes and diplomatic tension. In a post on Truth Social, Trump said Washington would reduce tariffs on Indian goods from 25% to 18% as part of the deal. According to Trump, the agreement also includes major commitments from New Delhi, including a pledge to stop purchasing Russian oil and to buy $500 billion worth of U.S. energy and technology products over time. Indian authorities have not yet confirmed or commented publicly on the announcement. Trump and Modi Speak by Phone The announcement followed a phone conversation between Trump and Indian Prime Minister Narendra Modi, a call that was first hinted at by U.S. Ambassador to India Sergio Gor. “President Trump just spoke with Prime Minister Modi. STAY TUNED…,” Gor wrote in a brief post on X, offering no further details. Trump later described the call as “an honour,” praising Modi as one of his “greatest friends” and calling him a “powerful and respected leader.” In the Truth Social post, Trump said the two leaders discussed trade and the war between Russia and Ukraine, though he did not elaborate on specific outcomes from the conversation. Social Media Posts Spotlight India Ties Earlier in the day, Trump shared multiple posts related to India on Truth Social, signaling renewed attention to the bilateral relationship. One post featured a photograph of the India Gate monument, which Trump described as “India’s beautiful Triumphal Arch,” adding, “Ours will be the greatest of them all!” In another post, Trump shared an image of himself and Modi on a magazine cover that labeled the two leaders as “newsmakers of the year 2025.” The posts appeared to underscore Trump’s emphasis on personal diplomacy and symbolism as he framed the trade announcement. Jaishankar Visit Adds Context The developments come as India’s External Affairs Minister S. Jaishankar began a three-day visit to the United States. Jaishankar is scheduled to attend a ministerial-level meeting focused on critical minerals supply chains, an area of strategic importance for both countries as they seek to reduce dependence on rival producers and secure materials vital to energy and technology sectors. While Jaishankar’s visit was planned in advance, the timing has drawn attention in light of Trump’s statements and the broader effort to stabilize India-U.S. relations. Brent Crude Oil Price Plunges The trade deal comes as the price of Brent crude oil plummets towards technical support on its chart. Brent crude oil price (Source: TradingView) In the past 24 hours, the price of Brent crude oil has slipped over 2%. As a result, it’s now testing the lower boundary of a short-term ascending price channel, which is also confluent with the $66 support level. A drop below that technical safety net could see BRENT fall down to the next mark at $63.545. Conversely, a rebound from the $66 support level may lead to a continuation of the bullish trend seen in the past week. This could lead to BRENT challenging the $69.395 resistance level before a possible climb to as high as $71.420 in an extreme case. Technical indicators, however, favor a bearish outlook. Specifically, both the Moving Average Convergence Divergence (MACD) and the Relative Strength Index (RSI) warn that sellers might push the price of Brent crude oil lower in the coming 24 hours. That’s after the RSI fell below its Simple Moving Average (SMA) line, a classic sign that bears have gained the upper hand. Meanwhile, the MACD line is dropping towards the MACD Signal line. Traders usually see this narrowing gap as a sign of cooling bullish momentum.