Oil prices steady on worries about geopolitical risks to supply
- Brent crude futures fell 18 cents, or 0.3%, to $62.99 a barrel
LONDON: Oil prices held firm on Tuesday as traders weighed up risks from Ukrainian drone strikes on Russian energy sites and mounting U.S.-Venezuela tensions.
Brent crude futures fell 18 cents, or 0.3%, to $62.99 a barrel by 1017 GMT. U.S. West Texas Intermediate crude was down 13 cents, or 0.2%, to stand at $59.19 a barrel.
Both benchmarks advanced more than 1% on Monday, while WTI was near a two-week high. “The latest goings-on in the oversupplied global picture putting pressure on prices have been balanced by hits on Russian infrastructure that accelerated through the weekend, as well as bubbling tensions between U.S.-Venezuela,” said Rystad analyst Janiv Shah.
“Geopolitical risk premiums have gained in the last few sessions as Russian-flagged vessels have also been targeted.” On Monday, the Caspian Pipeline Consortium said it had resumed oil shipments from one mooring point at its Black Sea terminal following a major Ukrainian drone attack on November 29.
Additionally, U.S. President Donald Trump said on Saturday “the airspace above and surrounding Venezuela” should be considered closed, sparking fresh uncertainty in the oil market, as the South American nation is a major producer.
“Focus is also on the Ukrainian peace talks, which might result in Russia increasing its crude oil and product exports once again, although this process is likely to be protracted,” said Tamas Varga, an analyst at PVM Oil Associates.
On the negotiation front, Trump’s special envoy, Steve Witkoff, and son-in-law Jared Kushner will meet Russian President Vladimir Putin on Tuesday for talks on a possible way to end the war.
Russian presidential envoy Kirill Dmitriev will also meet Witkoff in Moscow on Tuesday, sources close to U.S.-Russia talks told Reuters.
Kremlin spokesperson Dmitry Peskov told Indian journalists on Tuesday that a decline in India’s oil imports from Russia may last only for “a brief period” as Moscow plans to boost supplies to New Delhi.
Russia is the top oil supplier to India, the world’s third biggest oil importer and consumer, but the South Asian nation is set to lower its Russian oil purchases to at least a three-year
low this month, after Washington sanctioned Moscow’s top oil producer Rosneft and Lukoil.
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