Citi: The rise in oil prices opens a hedging window for producers, but the geopolitical premium may be difficult to sustain.

On October 23, Jin10 reported that Citigroup analyst Francesco Martoccia pointed out that the rise in oil prices triggered by the escalation of U.S. sanctions against Russia provides a hedging window for producers to lock in profits before the looming government price-cutting policies due to surplus supply concerns and the 2026 midterm elections. Although recent contracts have risen sharply, the 2026 WTI futures price has returned above $60 per barrel. However, this window may be fleeting, as Martoccia stated, “We believe that the geopolitical premium is destined to fade, as enforcement loopholes may widen, and shadow fleets and intermediary supply chains gradually adapt, especially when the loosening fundamentals become increasingly evident in the data.”