(RTTNews) – Crude oil fell on Friday on emerging signs of a Russia-Ukraine ceasefire and partly in lighter trading after the Christmas Day holiday.
Supply side concerns due to the escalating US-Venezuela conflict and the recent crisis in Nigeria limited further losses in prices.
WTI crude oil for February delivery was last seen trading at $56.94 per barrel, down $1.41 (or 2.42%).
In Europe, Russia has intensified air strikes on Ukraine since Christmas Eve.
For its part, Ukraine launched drone strikes targeting oil reserves at the port of Temryuk and a gas processing plant in Russia’s Orenburg region.
There are no signs yet of a peaceful end to the diplomatic path adopted by the US to stop the Russia-Ukraine war.
After commenting that talks between US envoys and Ukrainian high-level officials were smooth, Ukrainian President Volodymyr Zelensky said a new 20-point peace proposal is about 90% ready and said he was ready to meet US President Donald Trump at Mar-a-Lago on December 28 for further discussions.
Russia claimed that European countries were blocking peace talks but announced that talks were making “slow but steady” progress.
Although analysts are skeptical that Russia will back down on its “regional demands” in Ukraine, the announcement has sparked additional supply concerns over the potential return of Russian oil to global markets and weighed on oil prices today.
Meanwhile, Trump has long accused Venezuelan President Nicolas Maduro of promoting the illegal narco-trade that he says is fueling the opioid crisis in the US.
Denying Trump’s accusations, Maduro countered that Trump wanted to seize Venezuela’s rich oil reserves and called for United Nations intervention.
Since September, the US has launched dozens of attacks on ships linked to Venezuela in the Caribbean Sea and Pacific Ocean, while the US military has increased its presence around Venezuela.
Last week, Trump ordered a “complete naval blockade” of all sanctioned vessels entering or leaving Venezuela. The US Army has already seized two oil tankers.
On Monday, Trump announced that the US would either keep the seized oil as its strategic stockpile or sell it on the market. Tension increased with Trump’s comment that the US would probably oust Maduro from power.
On Tuesday, while the United Nations Security Council urged America to refrain from aggressive steps, China and Russia condemned these American attacks.
China, being a major oil importer of Venezuela, strongly condemned the US. According to experts, any intervention by China in support of Venezuela could escalate the crisis.
Meanwhile, in a fresh development in West Africa, the US struck ISIS positions in Nigeria’s Sokoto state in a joint operation with the country’s military. Nigeria has hinted at more such joint attacks to eliminate ISIS terrorists.
In the US, expectations of an interest rate cut by the US Federal Reserve have increased after Trump’s comments that he expects the next Fed chair to cut rates by up to 1%. Trump emphasized that he would expect those in power to never disagree with him.
Currently, the Fed has kept rates in the range of 3.50% to 3.75%.
On the inventory front, data from Baker Hughes Co. showed US crude oil rigs rose to 409 as of Dec. 23, up from 406 the previous week. Over the same period, total rigs increased from 542 to 545.
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