Oil Prices Decline as US, Russia Mull Diplomatic Talks
Oil prices declined in the global commodity market on Monday as US sanctions drew out Russia to possible peace talks over war in Ukraine. The market anticipate diplomatic contacts between the US and Russia over a potential resolution to the Ukraine crisis
Last week, Brent settled almost 1.2% higher as the Ukrainian attack on the Russian port of Novorossiysk stoked supply pressures. This led to a temporary suspension of oil exports from the port, which handles approximately 2.2 million barrels of oil per day, including Kazakhstan crude from the Caspian Pipeline Consortium (CPC) terminal.
“While the oil market is expected to remain in a large surplus through 2026, it is also facing growing supply risks. The scale and intensity of Ukrainian drone attacks on Russian energy infrastructure are picking up”, ING said in a note.
In addition to Friday’s attack on Novorossiysk, Ukraine claimed responsibility for a strike overnight on Rosneft’s 170,000 barrels per day Novokuibyshevsk refinery.
Brent crude was trading at $63.51 per barrel, down 0.6% from the previous close of $63.90. US benchmark West Texas Intermediate (WTI) also decreased by about 0.7% to $59.34, compared to $59.76 in the prior session.
Kremlin foreign policy aide Yuri Shakos said Washington and Moscow are maintaining dialogue based on understandings reached at the Alaska summit, adding that these arrangements “provide a strong foundation for moving toward a peaceful settlement.”
Ushakov noted that talks on a possible meeting between Russian President Vladimir Putin and US President Donald Trump remain underway. He said the summit has been delayed for the time being, though communication between the two sides continues.
If Washington and Moscow settle on a venue, he noted, any remaining technical or political hurdles would quickly fall into place.
Footage emerging from Russia’s Novorossiysk region also surfaced after Ukraine launched drone strikes on Nov. 13. Videos captured by residents show unmanned aerial vehicles targeting a refinery, fuel storage facilities and several vessels at the port – a key hub for Black Sea crude and product flows.
Despite persistent tensions between Russia and Ukraine, comments suggesting that Washington and the Kremlin are maintaining dialogue on a possible resolution to the Ukraine crisis helped reduce uncertainty over global energy supplies, adding further downward pressure on prices.
Alongside easing geopolitical fears, oil prices faced additional downward pressure from the latest commentary by Fed officials, who signaled caution over cutting interest rates too soon.
Their remarks dampened expectations for a December rate cut, reducing the probability from around 67% to 45% in money markets. The shift weighed on crude by strengthening the dollar and lowering investors’ appetite for risk-sensitive assets, including commodities.
A more cautious Fed reduces the likelihood of near-term monetary easing, which markets typically associate with stronger demand outlooks and lower financing costs.
Analysts note that the upcoming minutes of the Federal Open Market Committee, due this week, will be closely watched for further clues on the trajectory of rate-cut expectations.
On the other hand, Iran announced it had seized the Marshall Islands–flagged tanker Talara, carrying about 30,000 tons of petrochemicals, claiming the vessel was transporting cargo “without authorization” near the Gulf of Oman—adding renewed uncertainty to maritime flows already strained by regional tensions. Zenith Bank Edge Higher as Foreign Investors Take Positions
