Oil slips ahead of Trump Putin talks on Ukraine ceasefire

Oil slips ahead of Trump Putin talks on Ukraine ceasefire

August 15, 2025 (MLN): Oil prices declined on Friday as markets looked ahead to a meeting between U.S. President Donald Trump and Russian President Vladimir Putin, with some anticipating the talks could pave the way for a relaxation of sanctions on Moscow related to the war in Ukraine.

Brent crude futures decreased by $0.32, or 0.48%, to $66.52 per barrel.

West Texas Intermediate (WTI) crude futures fall by $0.45, or 0.70%, to $63.51 per barrel by [4:55 pm] PST.

At Friday’s meeting in Alaska between U.S. President Donald Trump and Russian President Vladimir Putin, a potential ceasefire in Ukraine is expected to dominate discussions. Trump has expressed confidence that Russia is ready to end the conflict but has warned that, if peace talks stall, the U.S. could impose secondary sanctions on nations purchasing Russian oil.

“The market is focused on whether a ceasefire materializes. A ceasefire would imply higher Russian output,” said Giovanni Staunovo, commodity analyst at UBS. “The real question is whether we see escalation or de-escalation.”

Staunovo noted that even if a ceasefire deal is reached, lifting U.S. sanctions on Russia would be a longer process requiring congressional approval.

For the week, West Texas Intermediate (WTI) crude is on track for a 0.7% decline, while Brent crude is set to post a 0.4% gain.

Adding to market pressures, weaker-than-expected economic data from China stoked concerns over fuel demand. Official figures showed factory output growth in July fell to its slowest pace in eight months, while retail sales growth was the weakest since December. This overshadowed data indicating stronger oil throughput, with Chinese refineries processing 8.9% more crude year-on-year in July. However, throughput dropped from June’s nine-month high, and a rise in oil product exports suggested softer domestic consumption.

Forecasts of a widening oil market surplus also weighed on sentiment, alongside expectations of prolonged higher U.S. interest rates. Bank of America analysts, in a Thursday note, expanded their surplus outlook, citing increased supply from OPEC+, which includes the Organization of the Petroleum Exporting Countries, Russia, and their allies. They now expect an average surplus of 890,000 barrels per day from July 2025 to June 2026.

The projection came just days after the International Energy Agency warned that the oil market appears “bloated” following OPEC+ output hikes.

Copyright Mettis Link News