Oil prices fell on Monday after US President Donald Trump announced that Russia and Ukraine had agreed to stop attacks on each other’s energy facilities, raising expectations of improved supplies from Moscow.
Brent crude futures dropped 11 cents, or 0.11 per cent, to $104.61 a barrel by 0627 GMT, while US West Texas Intermediate crude declined 49 cents, or 0.53 per cent, to $91.36 a barrel.
Both benchmarks had fallen by more than one per cent earlier in the session.
ICE gasoil futures also dropped three per cent to $1,436 per metric tonne following Trump’s announcement that Russia would immediately supply more than 300,000 metric tonnes, equivalent to about 2.25 million barrels, of diesel to US and global markets.
Trump said Russia would supply an additional 500,000 tonnes in November and another one million tonnes “immediately thereafter”.
Global daily diesel consumption is forecast to approach 29 million barrels, according to the International Energy Agency.
Trump also announced on Sunday that Russia and Ukraine had agreed to an energy ceasefire. However, Ukrainian President Volodymyr Zelensky said he was still awaiting details of the agreement, while Russia had not commented on the announcement.
The prospect of additional Russian supplies and a pause in attacks on energy infrastructure eased concerns about immediate supply disruptions, putting downward pressure on oil prices.
KCM Trade chief analyst Tim Waterer told Reuters that the announcements had reduced some of the immediate pressure on supplies.
However, he cautioned that uncertainty remained over whether the ceasefire would hold.
“Questions remain over the validity and longevity of any such ceasefire, and without clearer evidence that it will actually hold, the extent of the pullback is likely to stay limited,” Waterer said.
