Brent declines amid Russia-Ukraine ceasefire hopes

The front-month ICE Brent contract has lost $1.79/bbl on the day, to trade at $72.97/bbl at 09.00 GMT.

PHOTO: Oil pump jacks. Getty Images

Upward pressure:

Brent’s price found some support after the American Petroleum Institute (API) reported a small decline in US crude stocks.

Crude oil inventories in the US moved 640,000 bbls lower in the week that ended 21 February, according to API estimates.

The broadly followed US government data on crude oil stockpiles from the US Energy Information Administration (EIA) is due later today.

Downward pressure:

Brent's price came under pressure amid growing prospects of a ceasefire deal between Russia and Ukraine, which could end the three year-long conflict.

Oil investors are also waiting to see the potential impact of a minerals deal between the US and Ukraine.

The US and Ukraine have agreed on the terms of a draft deal on Ukraine’s vast minerals and natural resources, Reuters reports. The deal could be finalised later this week, Reuters adds citing US President Donald Trump.

This deal is expected to pave a way for increased US support for Kyiv, which seems highly crucial now as ceasefire talks have picked up pace.

Additionally, a ceasefire deal between Russia and Ukraine could see the US lifting its sanctions on Russian oil exports, which in turn could increase global oil supply, analysts said.

“This [deal] would take us a step closer to Russian sanctions being lifted, removing much of the supply uncertainty hanging over the market,” two analysts from ING Bank said.

By Aparupa Mazumder

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