Oil prices fall after Trump’s statements about an “energy truce”
Kyiv • UNN
Brent fell to $103.18 after Trump’s statements about future supplies of Russian diesel. Risks in the Middle East are limiting the decline.
Oil prices fell on Monday, October 12, amid expectations of increased supplies from Russia after U.S. President Donald Trump said there was an "energy truce" in the Russia-Ukraine war following the conclusion of a U.S. agreement with Moscow on diesel fuel supplies. UNN reports this, citing Reuters.
Details
Brent crude oil futures fell by $1.54, or 1.47%, to $103.18 per barrel by 01:54 GMT (04:54 Kyiv time), while the price of U.S. West Texas Intermediate crude fell by $1.54, or 1.68%, to $90.31 per barrel.
ICE diesel futures fell 3% to $1,436 per metric ton after President Trump said on Friday that Russia would immediately supply more than 300,000 metric tons (2.25 million barrels) of diesel fuel to the U.S. and global markets.
Russia will supply another 500,000 tons in November and another 1 million tons "immediately afterward," Trump added. According to forecasts by the International Energy Agency, daily global diesel fuel consumption will amount to about 29 million barrels.
On Sunday, Trump also unexpectedly announced an "energy truce" in the Russia-Ukraine war, but Ukrainian President Volodymyr Zelenskyy said he was still waiting for details of the agreement, while Russia declined to comment, the publication writes.
These statements somewhat eased immediate pressure on supplies, said Tim Waterer, chief analyst at KCM Trade.
"Questions remain regarding the validity and duration of any such agreement, and without clearer evidence that it will actually be honored, the scale of the pullback is likely to remain limited," he added.
IEA Executive Director Fatih Birol said on Sunday that all members of the organization should assess the need for additional diesel fuel supplies and that countries that have not yet fully met their volume commitments should accelerate their remaining deliveries, giving priority to diesel fuel.
The impact of the conflict in the Middle East persists
However, the conflict in the Middle East continues to support the price of Brent crude above $100 per barrel, the publication writes.
The Houthis claimed responsibility for Saturday's strike on Riyadh International Airport, which killed 13 people and injured more than 300, while Saudi authorities reported casualties from a new strike on the airport on Sunday.
U.S. President Donald Trump said on Saturday that the United States was considering joining Saudi strikes against the Houthis in the conflict, which is a consequence of the wider war with Iran launched by the U.S. and Israel in February.
In addition, new attacks on tankers passing through the Strait of Hormuz were recorded this month, threatening to slow the recovery of Middle Eastern oil exports that was observed in September.
The United Kingdom Maritime Trade Operations (UKMTO) reported over the weekend that one tanker was struck by a drone near the Sohar anchorage in Oman, while another was damaged by an unidentified projectile while passing through the Strait of Hormuz.
What is the oil price forecast
In a note, Goldman Sachs analysts raised their December forecast for the price of Brent crude to $90 per barrel from $85 previously.
"We maintain our base case that further supply adjustments from the Middle East will ultimately lead to lower oil prices, while a potential renewed escalation remains a significant net upside risk to prices," the analysts said, estimating the risk premium at slightly more than $20 per barrel.
"We forecast that WTI oil prices, which are exceptionally low relative to Brent because of high transportation costs between the U.S. and Europe, will average $81 in December 2026 and $73 in 2027," they added.
In the Gulf of Mexico, energy giants Shell, Chevron, and BP were attempting to redeploy personnel and resume production at their platforms after Hurricane "Isaias" hit the coast on Saturday morning.