Oil prices nose-dived on Tuesday in reaction to the talks between Russia, Ukraine and the U.S. to end the war in Ukraine. Traders envisions the possibility that the talks could lead to the lifting of sanctions on Russian crude, raising supply.
As at the time of filling this report, Brent crude futures were down 70 cents, or 1.0%, at $65.82 from 66.52 per barrel its previous day price. U.S. West Texas Intermediate crude futures for September delivery, were down 1.25 cents, or 1.96%, at $62.51 a barrel from $63.76 it sold previous day.
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Reuters had reported that the drop in price follows a White House meeting on Monday with Ukrainian President Volodymyr Zelenskiy and European allies, after which U.S. President Donald Trump announced in a social media post that he had spoken with Russian President Vladimir Putin.
Trump said arrangements were being made for a meeting between Putin and Zelenskiy, which could lead to a trilateral summit involving all three leaders.
“Following yesterday’s meeting between Trump, Ukrainian President Zelenskiy, and several European heads of state and government, there appears to be movement in the negotiations, fueling renewed hopes for an upcoming end to the war. As a result, oil prices are falling again today,” Commerzbank analysts said in a note.
Reuters, quoting Suvro Sarkar, lead energy analyst at DBS Bank, said Trump’s softened stance on secondary sanctions targeting importers of Russian oil had reduced the risk of global supply disruptions, easing geopolitical tensions slightly.
Chinese refineries have purchased 15 cargoes of Russian oil for October and November delivery as Indian demand for Moscow’s exports has fallen away, two analysts and one trader said on Tuesday.
Story by Tsvetana Paraskova on oilprices.com says that China scaled up its imports of Russia’s crude up to 75,000 barrels per day (bpd) for this month, according to data by Kpler cited by Bloomberg, as refiners buy additional volumes of discounted oil
For India, hiked U.S. tariffs over its imports of Russian crude have forced refiners to scaled down imports by more than halve to around 400,000 bpd so far in August, from an average of more than 1 million bpd so far in 2025, according to the shipments observed by Kpler.
The fall in global oil prices has expanded Nigeria’s budget deficit for 2025. Brent crude currently trading at $65 per barrel, below the Federal Government’s 2025 budget benchmark of $75 per barrel has created unease as oil production still slightly trail below official targets.
While crude oil output has improved to an average of about 1.5 million barrels per day (bpd) this year, it is still below the 2025 budget target of 1.78 million bpd. Nigeria need to galvanize efforts to increase production in order to defray the short fall in revenue.