Oil prices edged lower following two days of gains as markets digested mixed signals around the conflict in Ukraine and developments in Middle East diplomacy. Brent crude slipped below $66 per barrel, while West Texas Intermediate (WTI) hovered near $63 per barrel.
Uncertainty Over Ukraine-Russia Ceasefire Talks
U.S. President Donald Trump indicated that Ukraine and Russia might “immediately” begin ceasefire talks, but the U.S. could opt out of direct involvement. Additionally, there were no signs that Russia would increase pressure on OPEC+ producers to restrict output further.
This uncertainty has kept crude prices on edge, limiting sustained upward momentum despite recent gains.
Recent Crude Price Trends
Crude oil prices rebounded earlier this month, boosted by a thawing in U.S.-China trade tensions, which improved risk appetite among investors. This recovery followed a steep 16% decline in oil prices throughout April, reflecting oversupply concerns and weaker demand outlooks.
Potential Supply Risks from Eased Sanctions on Russia and Iran
Markets remain cautious about the prospect of increased oil supply if sanctions on Russia or OPEC+ member Iran are eased. Iran recently reaffirmed that its uranium enrichment capacity is “absolutely non-negotiable,” a sticking point in nuclear negotiations with the U.S. A successful nuclear deal could lift sanctions on Iranian oil exports, potentially adding more supply to an already oversupplied market in 2025.
Expert Insight on Price Outlook
Robert Rennie, head of commodities and carbon research at Westpac, noted that both current negotiation rounds between involved parties are likely to be lengthy and unpredictable. He commented:
“Brent crude oil prices look expensive in the $66-67 area and should fall back to the $60-65 waiting range as OPEC+ resumes production cuts.”
