Oil prices drop as supply worries ease

Hopes of a ceasefire in Ukraine are behind the slide in oil and gas prices

New York, U.S. | Xinhua | Oil prices tumbled on Tuesday as concerns over supply disruptions eased.

The West Texas Intermediate (WTI) for April delivery lost 6.57 U.S. dollars, or 6.4 percent, to settle at 96.44 dollars a barrel on the New York Mercantile Exchange. Brent crude for May delivery decreased 6.99 dollars, or 6.5 percent, to close at 99.91 dollars a barrel on the London ICE Futures Exchange.

On Monday, the WTI and Brent slumped 5.8 percent and 5.1 percent, respectively.

The marked pullback came as the talks between Russian and Ukrainian representatives are giving rise to hopes of rapprochement.

“Hopes of a ceasefire in Ukraine are behind the slide in oil and gas prices,” Carsten Fritsch, energy analyst at Commerzbank Research, said Tuesday in a note.

Supply concerns were also relieved as “Russian oil production still appears to be proceeding as normal despite the sanctions and the problems of selling the oil,” he said.

Ukrainian and Russian delegations resumed peace talks on Tuesday, local media outlet Ukrayinska Pravda reported, citing David Arakhamia, a member of the Ukrainian delegation.

The two sides started the fourth round of their talks via video link on Monday.

Ukrainian Presidential Advisor Mykhailo Podolyak, also a member of the delegation, said the two sides took a technical pause in the negotiations until Tuesday for “additional work in the working subgroups and clarification of individual definitions.”

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Xinhua