Oil Prices Decline Amid Diplomatic Talks to End Ukraine War

SadaNews - Oil prices fell as traders assessed the possibility of a ceasefire in Ukraine, while US President Donald Trump intensified efforts to arrange a summit between Vladimir Putin and Volodymyr Zelensky following a series of high-level talks.

The price of Brent crude dropped to around $66 per barrel after rising by 1.1% in the previous session, while West Texas Intermediate crude traded near $63.

Trump made a call to the Russian president urging him to start arranging a bilateral meeting with Zelensky, following his talks with the Ukrainian leader on Monday at the White House.

A Shift in Favor of Kyiv After Alaska Summit

Trump's discussions with Zelensky seemed to reflect a shift in favor of Kyiv, just days after his meeting with Putin in Alaska, where he stated that the responsibility for ending the conflict lies with Ukraine. He also proposed holding a trilateral meeting after the bilateral summit.

Any ceasefire could lead to increased oil supply from Russia.

Recently, efforts to end the war intensified with Trump and Putin's meeting on Friday, followed by talks with Zelensky and European leaders on Monday.

Market Uncertainty Continues Despite Oil Decline

This added to the uncertainty in the market, yet oil prices remain over 10% lower since the beginning of the year, due to concerns about the ramifications of US trade policies and the potential for an oversupply as the "OPEC+" alliance resumes oil supplies to the market.

Vandana Hari, founder of Vanda Insights, an oil market analytics firm in Singapore, said: "Oil prices may enter a phase of relative stability without a clear trend... A glimmer of hope for resolving the conflict appears, but the road is still long."

Despite diplomatic efforts, attacks continue from both sides. Ukraine announced that it launched a new strike on the Russian "Druzhba" pipeline system on Monday, disrupting a vital corridor for oil supplies to parts of Central Europe.

Berlin: Putin-Zelensky Summit Could Be Held in Two Weeks

German Chancellor Friedrich Merz stated, following a meeting at the White House, that a possible meeting between Putin and Zelensky could be held within two weeks. Zelensky described his talks with Trump as the best he's had so far.

Regarding the oil market, investors are waiting to see how ceasefire measures will affect the imposed sanctions.

Trump recently ramped up economic sanctions on India for buying Russian oil but exempted China, the largest purchaser of crude, from what are known as "secondary sanctions."

The price of Brent crude for October delivery fell by 0.6% to $66.23 per barrel at 11:40 AM in Singapore. Meanwhile, West Texas Intermediate crude for September delivery dropped by 0.6% to $63.03 per barrel.