Oil prices fell on Tuesday as traders weighed the possibility that talks between Russia, Ukraine, and the US could lead to the lifting of sanctions on Russian crude, raising supply. Brent crude futures dropped by 48 cents, or 0.72 per cent, settling at $66.12 a barrel by 0820 GMT, while US West Texas Intermediate (WTI) crude futures for September delivery saw a decrease of 40 cents, or 0.63 per cent, to $63.02 per barrel.
- The more actively traded October WTI contract also declined, falling 46 cents, or 0.73 per cent, to .24 a barrel. This comes after prices were up around 1 per cent in the previous session.
- Trump has been pushing for a swift resolution to Europe's deadliest conflict in 80 years, yet Kyiv and its allies express concerns that he may attempt to broker an agreement on Russia’s terms.
The more actively traded October WTI contract also declined, falling 46 cents, or 0.73 per cent, to $62.24 a barrel. This comes after prices were up around 1 per cent in the previous session.
Following a meeting at the White House with Ukrainian President Volodymyr Zelenskiy and European allies, US President Donald Trump announced via social media that he had spoken with Russian President Vladimir Putin. Trump revealed that arrangements were underway for a meeting between Putin and Zelenskiy, which could potentially lead to a trilateral summit involving all three leaders.
“Oil prices are largely responding to outcomes of recent meetings between Trump-Putin and Trump-Zelenskiy, and while no outright peace deal or ceasefire seems imminent, there has been some progress made,” stated Suvro Sarkar, lead energy analyst at DBS Bank. He further commented that the chances of further escalation or intensification of sanctions on Russia from the US or Europe appear to be off the table for now.
Sarkar also noted that Trump’s softened stance on secondary sanctions targeting importers of Russian oil has eased the risk of global supply disruptions, contributing to a slight decrease in geopolitical tensions.
Zelenskiy described his discussions with Trump as “very good,” highlighting talks about US security guarantees for Ukraine. Trump confirmed that the US would provide such guarantees, although the extent of this support remains uncertain.
Trump has been pushing for a swift resolution to Europe’s deadliest conflict in 80 years, yet Kyiv and its allies express concerns that he may attempt to broker an agreement on Russia’s terms.
“An outcome which would see a ratcheting down of tensions and remove threats of secondary tariffs or sanctions would see oil drift lower toward our $58 per barrel Q4-25/Q1-26 average target,” remarked Bart Melek, head of commodity strategy at TD Securities, in a note.
