Global oil prices decreased on Monday following a social media statement by U.S. President Donald Trump announcing an “energy ceasefire” between Russia and Ukraine. The price movement also coincided with reports of diplomatic communications between Iran and Saudi Arabia regarding regional stability.
On Monday, futures for Brent crude, the international benchmark, fell 1.65% to $102.99 a barrel for December delivery. West Texas Intermediate (WTI) futures, the U.S. standard, declined 1.92% to $90.09 per barrel for November delivery.
The market activity followed a statement posted by Trump on social media. “Effective immediately, there is an ENERGY CEASEFIRE in the War between Russia and Ukraine. Both parties have agreed. Do not break it!” the post read.
Following the announcement, Ukrainian President Volodymyr Zelenskyy issued a statement on social media, writing, “Ukraine supports the ceasefire, and it is important that Russia support it as well.”
The development came after Trump stated on Friday that Russia would supply over 4 million tons of diesel to the global market under a deal he said was made with Russian President Vladimir Putin during a phone call.
In the Middle East, diplomatic efforts were also reported. The Saudi state news agency stated that Iran’s Minister of Foreign Affairs, Abbas Araghchi, held a phone call with Saudi Arabia’s Minister of Foreign Affairs, Faisal bin Farhan bin Abdullah. The call reportedly addressed recent regional events and efforts to resolve them.
Separately, Al Jazeera reported that Araghchi said Iran was prepared to help facilitate dialogue between Saudi Arabia and Yemen’s Houthi group.
Other factors influencing energy markets were also noted by financial analysts. A research note from the United Overseas Bank (UOB) on Monday addressed the potential effects of Hurricane Isaias. “The pressure on oil prices could remain on the upside as Hurricane Isaias strengthened to Category 3 with 120mph winds as it approached the US Gulf Coast, forcing energy producers to curtail offshore output,” the note stated.
The UOB note also mentioned a Houthi missile strike on Saturday at an airport in Riyadh, Saudi Arabia, which it said had “materially elevated Middle East risk premia.” According to reports, the strike resulted in 12 deaths and over 300 injuries.
