DTN Oil Update
Oil Rebounds as Russia-Ukraine Talks End Fruitlessly
VIENNA (DTN) -- Oil and product futures jumped Wednesday morning after U.S.-hosted negotiations to end the war between Russia and Ukraine broke up abruptly, after only two hours of discussions.
The breakdown in Geneva came a day after reports of progress in talks aimed at shuttering Iran's nuclear program, also held in the Swiss city and brokered by the U.S.
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The zigzag in geopolitical risk premium created a volatile path for oil futures, which fell in the previous session before the current rally.
Ukrainian president Volodymyr Zelenskyy accused Russia of not desiring a peace deal in the talks that began Tuesday. But former Russian culture minister Vladimir Medinsky, who represented the Kremlin at the negotiations, said there will be another round, without specifying a date.
A backdrop of global tensions has supported oil prices since the start of this year despite bearish fundamentals. The International Energy Agency in its latest monthly oil market report published Thursday, Feb. 12, cut demand growth expectations for 2026, forecasting a 3.7 million bpd crude oversupply this year.
In the U.S. particularly, swelling petroleum fuel inventories have raised some demand growth concerns.
As of Feb. 6, gasoline and distillate fuel oil stocks were up 5% year-on-year, according to U.S. Energy Information Administration data. Part of the rise, however, can be attributed to higher-than-usual refining activity amid strong refining margins.
Weekly inventory estimates by the American Petroleum Institute are scheduled for release later today, and official inventory data from the EIA are on tap for Thursday morning release. Both have been delayed by one day due to Presidents Day holiday.
NYMEX WTI crude futures for March delivery rose $1.52 to $63.85 bbl, while ICE Brent for April delivery advanced $1.58 to $69 bbl.
Downstream, front-month ULSD futures were up $0.0562 to $2.4468 gallon, and RBOB for March delivery rose $0.035 to $1.9494 gallon.
The U.S. Dollar Index was little changed, up 0.14 points to 97.2 against a basket of foreign currencies.