Oil prices slipped in early Asian trade on Tuesday as market participants contemplated planned three-way talks among Russia, Ukraine and the U.S. to end the war in Ukraine, which could lead to an end to sanctions on Russian crude.
Brent crude futures fell 7 cents, or 0.11%, to $66.53 a barrel by 0000 GMT. U.S. West Texas Intermediate crude futures for September delivery, set to expire on Wednesday, fell 6 cents, or 0.09%, to $63.36 per barrel.
The more active October WTI contract was down 9 cents, or 0.14%, at $62.61 a barrel.
Prices settled around 1% higher in the previous session.
Following talks with Ukraine President Volodymyr Zelenskiy and a group of European allies in the White House on Monday, U.S. President Donald Trump said in a social media post he had called his Russian counterpart Vladimir Putin and begun arranging a meeting between Putin and Zelenskiy, to be followed by a trilateral summit among the three presidents.
“An outcome which would see a ratcheting down of tensions and remove threats of secondary tariffs or sanctions would see oil drift lower toward our $58 per barrel Q4-25/Q1-26 average target,” Bart Melek, head of commodity strategy at TD Securities said in a note.
Zelenskiy described his direct talks with Trump as “very good” and said they had spoken about Ukraine’s need for U.S. security guarantees.
Trump has pressed for a quick end to Europe’s deadliest war in 80 years, but Kyiv and its allies worry he could seek to force an agreement on Russia’s terms.
“A result which would see the U.S. apply pressure on Russia in the form of broader secondary tariffs against Russia’s oil customers (as those now faced by India) would no doubt move crude to the highs seen a few weeks ago,” Melek added.
(Reporting by Anjana Anil in Bengaluru; Editing by Sonali Paul)