Oil Prices Struggle, Ukraine Peace Near!
Global oil prices are stable after closing at their lowest level in a month. This movement occurs amid signs that a peace agreement regarding Ukraine is approaching, which could open the door to lifting restrictions on Russian oil exports at a time when the market is facing a potential oversupply.
West Texas Intermediate (WTI) oil is hovering near US$58 per barrel after falling 1.5% in trading on Tuesday, while Brent closed just above US$62 per barrel. US President Donald Trump said only a few points of difference remain to be resolved and has sent a negotiating team for further talks. The Ukrainian president's chief of staff also said the talks in Geneva provide a "good foundation" for an agreement.
Over the past few years, much of Russia's oil and petroleum products have been subject to strict Western sanctions, including restrictions on Russia's two largest oil producers that only came into effect last week. However, Russia is still able to supply discounted oil to China, India, and Turkey. Therefore, the impact of the sanctions relief on global oil prices remains difficult to predict.
Since mid-June, oil prices have fallen more than 20%. This decline was triggered by increased supply from OPEC+ countries, which have again increased production, plus other producers outside the group also increasing output. Meanwhile, global oil consumption is considered to remain weak. The International Energy Agency (IEA) even estimates that oil supply will exceed demand by a record 4 million barrels per day next year.
From the United States, data from the American Petroleum Institute shows that national crude oil inventories fell slightly by around 1.9 million barrels last week. Ahead of the release of official government data on Wednesday, the price of WTI for January delivery rose 0.2% to US$58.08 per barrel in the Singapore morning session, while Brent for January closed down 1.4% to US$62.48 per barrel in trading on Tuesday. (asd)
Source: Newsmaker.id
