Oil prices inched higher on Monday as markets awaited a critical meeting in Washington between U.S. President Donald Trump and Ukrainian President Volodymyr Zelensky, with traders evaluating potential impacts on global supply.
At 07:45 ET (11:45 GMT), Brent crude for October delivery rose 0.5% to $66.18 per barrel, while West Texas Intermediate (WTI) gained 0.7% to $62.41 per barrel. Both contracts had dropped nearly 1.5% on Friday, finishing the week with sharp losses following the U.S.-Russia summit.
Focus on Washington
Trump is scheduled to meet Zelensky later in the day, alongside several European leaders, as they work toward a potential peace agreement to end Europe’s deadliest war in eight decades. European officials aim to prevent any outcome that could compromise Ukraine’s territorial integrity.
This follows a prior summit in Alaska between Trump and Russian President Vladimir Putin, which failed to produce tangible results. Earlier, Trump stated that a ceasefire would be his “key demand,” even threatening to leave the talks and impose tougher measures on Moscow. The statement had fueled concerns about constrained supply.
“While talks failed to secure a ceasefire, the tone and the absence of ’severe consequences’ for the lack of a truce, reduce, or at least delay, the risks of stricter sanctions,” ING analysts noted in a report.
Meanwhile, White House trade adviser Peter Navarro warned Monday that India’s purchases of Russian crude were funding Moscow’s war in Ukraine and needed to stop.
“India acts as a global clearinghouse for Russian oil, converting embargoed crude into high-value exports while giving Moscow the dollars it needs,” Navarro said.
China and India remain the largest buyers of Russian crude. In response, Trump has imposed an additional 25% tariff on Indian goods, effective August 27, citing the country’s Russian oil imports.
“Ultimately, Russia still wants Ukraine to cede territory, something Ukraine will be very hesitant to do, particularly without very strong security guarantees from the US and Europe,” ING analysts added.
“Ultimately, the reduced risk of tougher sanctions and secondary tariffs should allow bearish oil fundamentals to become the dominant driver for oil prices moving forward,” they said.
Eyes on Jackson Hole
Outside geopolitical developments, investors are also watching for hints from Federal Reserve Chair Jerome Powell at this week’s Jackson Hole symposium, particularly regarding the pace of U.S. interest rate cuts.
Markets widely anticipate a 25-basis-point rate cut at the Fed’s September meeting, though last week’s hotter-than-expected producer price data has effectively ruled out a larger 50-point reduction. Lower interest rates typically stimulate economic activity, which in turn boosts energy demand.
This content is for informational purposes only and does not constitute financial, investment, or other professional advice. It should not be considered a recommendation to buy or sell any securities or financial instruments. All investments involve risk, including the potential loss of principal. Past performance is not indicative of future results. You should conduct your own research and consult with a qualified financial advisor before making any investment decisions.
Leave a Reply