DTN Oil Update
Oil Futures Reversed Gains on Geopolitical Events
HOUSTON (DTN) -- Oil futures reversed gains recorded Tuesday morning, driven by expectations of a possible ceasefire on Ukrainian energy and infrastructure and despite Israel resuming attacks on Gaza Tuesday.
The April NYMEX WTI futures contract dropped by $0.71 to $66.87 bbl while the front-month ICE Brent futures contract fell by $0.54 to $70.53 bbl. April RBOB futures contract climbed by $0.0157 to $2.1965 gallon and April ULSD futures increased by $0.0073 to $2.1965 gallon.
The U.S. Dollar Index rose by 0.12% to 102.88 against a basket of foreign currencies.
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The White House said Tuesday that U.S. President Donald Trump and Russian President Vladimir Putin agreed to seek a limited ceasefire against energy and infrastructure targets in the Russia-Ukraine war, during a call on Tuesday, according to an Associated Press report.
Meanwhile, Tuesday morning, Israel launched deadly airstrikes across the Gaza Strip, marking a shift since a ceasefire took effect in January. This comes after President Trump ordered air raids targeting Houthi rebels in Yemen over the weekend.
The oil futures market has focused on geopolitical events this week, even as the anxiety over the potential impact of trade tariffs on the global economy and the possibility of a recession in the U.S. economy persist.
Market participants continue monitoring the ongoing Federal Reserve meeting, which started Tuesday and will conclude on Wednesday. Fed's chair, Jerome Powell, is expected to announce the Federal Reserve's decision on interest rates. Powell has declared that the Fed is in no rush to cut interest rates as the economy is doing well.
However, the Fed's decision could shift due to inflationary pressures on the U.S. economy caused by punitive tariffs imposed by the Trump administration on its main trade partners in recent weeks.
The United States has imposed 20% tariffs on imported goods from China, 25% on steel and aluminum imports from Canada and Mexico, 10% on Canadian energy and 25% on imports from the European Union.
Downstream, the Energy Information Administration reported on Monday that U.S. average on-highway diesel fuel price fell by 3.3cts to $3.549 gallon as of March 17, which was 47.9cts lower than the same week in 2024. It was also the lowest level since Dec. 30.
The national average for retail regular gasoline continued lower for a third week, falling 0.11cts to $3.058 gallon as of Monday, March 17, down 3.95cts from the same time last year.
Separately, the EIA announced Tuesday that beginning the week of April 7, 2025, the weekly publication of the Gasoline and Diesel Fuel Update will move from Monday afternoons to Tuesday mornings at approximately 10:00 a.m. EDT.
When Monday is a federal holiday, the report will be published on Wednesday mornings at the same time, the EIA stated.
