(RTTNews) – Crude oil rose on Friday as the success of a US-proposed peace deal to end the Russia-Ukraine war remains uncertain, with Russia adding strong preconditions.
WTI crude oil for January delivery was last seen trading at $58.83 a barrel, up $18 (or 0.31%).
On the geopolitical front, the administration of US President Donald Trump has come up with a new 10-point plan to end the ongoing Russia-Ukraine war as soon as possible.
The principles of the peace deal received the approval of Ukrainian President Volodymyr Zelensky, although he said there were some minor issues in the proposal that needed to be settled for which he was willing to talk to Trump.
Yesterday, Russian President Vladimir Putin agreed to move ahead with the US-backed plan.
However, Putin has reiterated his demand to retain the areas occupied by Russia in Ukraine and has made it clear that Russia is ready to fight if necessary.
The issue is seen as a major point of contention in the ceasefire plan.
Next week, US Envoy to Russia Steve Witkoff is landing in Russia to discuss peace plans, while US Army Secretary Dan Driscoll is scheduled to visit this week.
Russia is now facing sanctions imposed by the US and the West on its oil exports.
The US has targeted major Russian oil corporations Rosneft and Lukoil, significantly impacting Russian petrodollar revenues.
The geopolitical risk premium remains high as investors fear Russian intransigence could hinder ceasefire plans.
For the week ended Nov. 21, U.S. crude oil stockpiles rose by 2.77 million barrels, reversing a decline of 3.426 million barrels in the previous week, according to the U.S. Energy Information Administration.
Last week, Baker Hughes reported that active US oil rigs fell to a 4-year low, indicating lower oil production in the near term.
Traders are now eyeing the decision on production increase to be announced by the OPEC alliance after its meeting on Sunday. Member states are gradually increasing their production in 2025.
At their last meeting, the cartel agreed to increase production by 137,000 barrels per day for the month of December. Contrary to analysts’ expectations, the group agreed to put the hike on hold until the first quarter of 2026.
Reuters reported that OPEC is likely to leave production levels unchanged at its Sunday meeting.
Expectations of a rate cut by the US Federal Reserve are rising after recent dovish comments from several Fed Governors.
Reports in some sections of the media that Kevin Hassett, director of the National Economic Council, is emerging as the leading choice to replace current Fed Chairman Jerome Powell in 2026 have boosted expectations. Hassett has been clearly vocal about his preference for a low-interest rate regime in line with Trump’s preferences.
Analysts believe the outcome of the OPEC meeting in early December and the Fed meeting in the second week of December could determine the direction of oil prices in the near future.
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