DTN Oil Update
Oil Dips on Putin-US Talks Amid Russia Sanctions
SECAUCUS, N.J. (DTN) -- Crude futures dipped Tuesday, Dec. 2, as Russian President Vladimir Putin held talks in Moscow with U.S. representatives seeking to end the war in Ukraine.
A successful outcome to the talks, led by U.S. envoy Steve Witkoff and President Donald Trump's son-in-law Jared Kushner, could remove sanctions against Russian oil that would add to global oversupplies. But Putin also warned earlier in the day that he would also wage war, if necessary, against European nations that supported Ukraine in attacking Russian oil tankers and infrastructure.
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The NYMEX WTI contract for January delivery settled down $0.68 bbl at $58.64 bbl. ICE Brent for February delivery retreated $0.76 to $62.43 bbl.
Downstream, January RBOB gasoline futures softened $0.0380 to $1.8309 gallon, and front-month ULSD futures dropped $0.0322 to $2.3078 gallon.
The U.S. Dollar Index was little changed, down 0.037 points to 99.325 against a basket of foreign currencies.
Crude futures also came under pressure after Bloomberg reported that more than 180 million barrels of Russian oil were at sea at the end of November, up by 21% over the past three months.
"It's going to be hard for this market to catch a break for long, with all the enigma over the Russian oil on water," said John Kildufff, partner at New York energy hedge fund Again Capital.
The increasing volume of Russian oil at sea rekindled concerns of oversupply that had bogged the market down for months.
Crude futures rose Monday, Dec. 1, though after the Organization of the Petroleum Exporting Countries and its allies, collectively known as OPEC+, announced at the weekend they will honor a pledge made in November that they will not boost production in the first quarter of next year.
Prior to that, OPEC+ made three upward adjustments of 137,000 bpd for October through December. Those increases came despite the organization itself estimating later that the market was probably in a surplus off 500,000 bpd by the third quarter of this year.