Key facts
- Oil prices declined as President Trump announced a diesel deal with Russia and an energy ceasefire between Ukraine and Russia.
- Brent crude was trading at $104 a barrel, and WTI crude at $91 a barrel, down 0.2% and 0.7% respectively.
- Attacks on Saudi Arabia's King Khalid International Airport by Houthis killed 13 and injured over 300 on Saturday, with another attack on Sunday killing one and wounding 11.
- ING analysts stated the Russia diesel deal would not solve middle distillate market tightness but is pressuring down gasoil cracks.
- Trump lifted sanctions on Russian diesel and struck a deal with Putin to import Russian diesel to lower prices before the midterm elections.
Oil prices dipped in early European trading as President Trump's announcement of an "energy ceasefire" between Russia and Ukraine countered Middle East tensions. Brent crude was trading at $104 a barrel, and WTI crude at $91 a barrel, down 0.2% and 0.7% respectively. The market appeared to be prioritizing the potential for increased Russian diesel supply over the weekend's escalation in the Middle East, which included Houthi attacks on Saudi Arabia's King Khalid International Airport. These attacks killed 13 people and injured over 300 on Saturday, with another attack on Sunday resulting in one death and 11 injuries. Although not directly targeting energy infrastructure, the ongoing conflict in the region could widen. ING analysts noted that while the Russia diesel deal, which involved lifting sanctions and importing fuel to lower prices ahead of the midterm elections, would not solve tightness in the middle distillate market, it was pressuring down gasoil cracks. They added that sustained lower refined product prices would require normalization in the Middle East.