NEW YORK: Oil prices edged lower on Tuesday, after falling 2 percent in the previous session, with investors keeping a close eye on peace talks to end Russia’s war in Ukraine, concerns about ample supply and a looming decision on US interest rates.
Brent crude futures fell 52 cents, or 0.83 percent, to USD61.96 a barrel at 11:30 a.m. ET (1630 GMT). US West Texas Intermediate crude dropped 62 cents, or 1.05 percent, at USD58.26 a barrel.
Both contracts fell by more than USD1 a barrel on Monday after Iraq restored production at Lukoil’s West Qurna 2 oilfield, one of the world’s largest.
Ukraine will share a revised peace plan with the US after talks in London between its President Volodymyr Zelenskiy and the leaders of France, Germany and Britain.
“Many in the market don’t feel that Russia is serious about a peace agreement and they’re just simply buying time,” said Andrew Lipow, president of Lipow Oil Associates.
On Tuesday, power was out for roughly half of residents in the Ukrainian capital Kyiv after the latest Russian attacks on the country’s energy system.
Aiming to cut Moscow’s oil revenue, the Group of Seven countries and the European Union are in talks to replace a price cap on Russian oil exports with a full maritime services ban, sources familiar with the matter said.
The next International Energy Agency report should hold clues on the supply outlook.
“The next (market) driver is likely to be the IEA monthly oil market report for December, released on 11 December, which it has predicted a record surplus in the oil market in 2026, highlighted in previous outlook reports,” said OANDA senior market analyst Kelvin Wong.
If the IEA continues to flag surplus risk in the oil market in its December report, WTI crude could drift downwards to test the range support zone at USD56.80 to USD57.50 a barrel, he added.
“(Brent) is being pushed towards the USD60-line by the booming amount of oil at sea,” said SEB’s chief commodities analyst Bjarne Schieldrop.
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