Oil prices fall after Trump’s agreement with Putin
19 March 09:59
Oil prices fell after Russia agreed to US President Donald Trump’ s proposal to temporarily suspend mutual attacks on energy infrastructure in the Russia-Ukraine war. Traders reacted as this could lead to an increase in the volume of Russian oil on world markets, Komersant ukrainskyi reports citing Reuters.
Brent crude futures fell 23 cents, or 0.3%, to $70.33 per barrel as of 09:30 Kyiv time. The price of US West Texas Intermediate (WTI) crude oil fell 25 cents, or 0.4%, to $66.65.
Trump’s agreement with Putin
Russian President Vladimir Putin agreed on Tuesday to stop attacks on Ukrainian energy facilities, but did not support a full 30-day ceasefire, as Trump had hoped for.
“This agreement is a positive step towards a possible resolution of the conflict, as the cessation of attacks on Ukrainian energy facilities reduces the risks of further disruptions in oil supplies and puts some pressure on prices,”
– said Yeap Jun Rong, Market Strategist at IG.
Russia is one of the world’s leading oil suppliers, but its production has declined since the beginning of the war due to sanctions on Russian energy resources.
A potential ceasefire could lead to an easing of sanctions, which could increase oil supply and lower prices, analysts say.
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Other factors influencing the market
US duties on goods from Canada, Mexico and China have increased fears of a recession, which has also affected oil prices, as this could negatively affect demand for raw materials.
Trump vowed to continue attacks on the Houthis in Yemen and said he would hold Iran responsible for any attacks carried out by the group, which disrupted shipping in the Red Sea.
At the same time, Israeli air strikes in Gaza killed at least 200 people, Palestinian health authorities said, ending a week-long ceasefire and raising the risk of a threat to oil supplies from the region.
Meanwhile, data on crude oil inventories in the US showed a mixed picture: crude oil stocks increased, while fuel stocks decreased.
According to the American Petroleum Institute, crude oil inventories increased by 4.59 million barrels in the week ended March 14. Gasoline stocks decreased by 1.71 million barrels, and distillate stocks decreased by 2.15 million barrels.
Outlook
Oil markets continue to focus on lower prices despite rising tensions in the Middle East, Goldman Sachs analysts said on Wednesday.
“Tightening tariffs and significant spare capacity shift the medium-term risks to our outlook to the downside,”
– the analysts said.
