Key Points
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Brent crude fell to 59.60 dollars per barrel.
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Oversupply and weak demand pressured oil markets.
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Analysts expect cautious sentiment in coming weeks.
At the end of the week, global oil markets were lower. This was because people were more hopeful about a possible peace deal between Russia and Ukraine, demand indicators from the United States were weak, and concerns about supply problems in Venezuela were lower. Intermittent geopolitical flare-ups kept losses to a minimum, but they weren’t enough to keep the upward momentum going.
Brent crude, the international benchmark, was selling for $59.67 per barrel, which is 2.2% less than the $61.02 it was selling for last Friday. The price of US West Texas Intermediate oil fell 4.3% from last week’s price of $59.93 per barrel to $57.37 per barrel.
Analysts said that markets were affected by the hope that diplomatic efforts to end Russia’s war in Ukraine could speed up. Before US–Russian talks, US President Donald Trump told Kyiv to move quickly. This made people think that sanctions on Russian crude might be eased over time.
Brent crude responds to hopes for peace between Russia and Ukraine
The news that Kirill Dmitriev, head of the Russian Direct Investment Fund, might be able to take part in talks also moved the markets. This made it seem like Russian oil flows might stay the same or even go up. Analysts said that the geopolitical risk premium went down because people thought that sanctions would be less strict and there would be fewer problems with Russian energy infrastructure.
The US Energy Information Administration’s data made people feel even worse. Petrol inventories went up by 4.8 million barrels, but US commercial crude inventories only fell by 1.3 million barrels, which was less than the expected 2.4 million barrels. The average amount of crude oil produced in the US also went up by about 10,000 barrels per day, which made people think there was plenty of supply.
Concerns about Venezuela’s supply ease market pressure
After Trump ordered a blockade of Venezuelan tankers that had been sanctioned and confirmed vessel seizures, oil prices went up for a short time. But the gains didn’t last long because there was no real disruption. Mexican President Claudia Sheinbaum’s calls for a peaceful UN-led solution eased fears that Venezuela would lose supplies. Analysts said that Venezuela’s production of 1.1 million barrels per day is a small part of global trade, so it won’t have a big effect on prices over time.
Experts say that developments focused on diplomacy and weak US demand will likely continue to shape short-term oil market trends, which will keep crude prices unstable despite mixed signals from around the world.
