Oil prices eased in Asian trading on Tuesday, retracing part of Monday’s gains as investors assessed the risk of additional U.S. sanctions on Russia alongside tentative progress toward a Ukraine peace agreement.
As of 21:45 ET (01:45 GMT), October Brent crude fell 0.5% to $68.46 per barrel, while West Texas Intermediate (WTI) dipped 0.6% to $64.44 per barrel. Both contracts had climbed nearly 2% on Monday after Ukrainian drone attacks on Russian oil and gas infrastructure heightened concerns over supply.
Geopolitical Factors Influence Market Moves
The ongoing conflict in Ukraine continues to dominate market sentiment. U.S. President Donald Trump has positioned himself as a potential mediator but warned last week that new sanctions could be imposed on Moscow if no progress is made toward a peace deal within two weeks.
Vice President J.D. Vance stated that Russia had made “significant concessions,” including security assurances for Ukraine, though Western diplomats noted that Moscow has not committed to a binding framework. Trump has suggested a trilateral summit with Ukrainian President Volodymyr Zelenskiy and Russian President Vladimir Putin, though a date has not been set.
The possibility of a peace agreement has sparked concerns over a potential global oil surplus, particularly if U.S. sanctions on Russian oil are eased. Yet, oil prices remain supported as optimism over a ceasefire wanes, and further U.S. restrictions on Russian crude could boost prices.
Trade Update: U.S. Tariffs on India
In trade developments, the U.S. is set to implement an additional 25% tariff on Indian goods starting August 27, raising the total to 50%, in response to India’s increased purchases of Russian crude. Indian officials have voiced frustration, emphasizing the need to safeguard national interests.
Some Indian oil processors have signaled plans to continue buying Russian crude, indicating sustained demand that could help support global oil prices.
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