Oil reversed Friday’s decline as US-led talks to end Russia’s war in Ukraine faced new complications and China vowed to support growth next year.
West Texas Intermediate climbed 2.4% to settle above $58 a barrel, while Brent closed near $62. The US has stepped up a push to end the war, and President Donald Trump said he made progress in talks on Sunday with Ukrainian counterpart Volodymyr Zelenskiy at Mar-a-Lago. But new sticking points emerged on Monday when Russian President Vladimir Putin said Russia would revise its negotiating position due to a purported drone attack on one of his residences.
Oil is still on track for a fifth monthly drop in December, which would be the longest run of declines in more than two years. Prices have been dragged lower by concerns about a global glut following supply increases from members of the OPEC+ cartel as well as nations outside the group. Geopolitical tensions from Venezuela to Nigeria have helped stem the slump in recent weeks.
On Ukraine, the lack of a breakthrough on a peace deal lent some support to prices, said Gao Mingyu, chief energy analyst at China Futures Co., citing issues including the fate of the Donbas region that is partially occupied by Russian forces. “It feels like there is still back-and-forth ahead,” she said.
China, meanwhile, pledged to broaden its fiscal spending base next year, according to a statement from the Ministry of Finance on Sunday, signaling government support to drive growth. The world’s top crude importer has faced headwinds amid a property downturn and external pressures, including trade frictions with the US. At the same time, Beijing’s robust stockpiling of crude is expected to continue, helping to absorb the surplus.
Meanwhile, Trump and Israeli Prime Minister Benjamin Netanyahu appear set to discuss potential new strikes on Iran over its ballistic missile program and the rebuilding of nuclear sites hit by the US in June during a Monday meeting. Renewed tensions in the Middle East, the source of about a third of the world’s supplies, could imperil crude flows from the region.
In Venezuela, the Trump administration has imposed a partial maritime blockade in recent days, backed by the largest US military deployment to the region in decades. Trump said the US struck an “implementation area” in the South American country where boats are allegedly loaded with drugs. Venezuela has described US actions as illegal and a push for regime change.
Oil Prices
WTI for February delivery gained 2.4% to settle at $58.08 a barrel in New York time.
Brent for February settlement climbed 2.1% to settle at $61.94 a barrel.
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