Brent crude futures fell 14 cents, or 0.22%, to $62.42 per barrel at 0148 GMT. West Texas Intermediate was down 15 cents, or 0.26%, at $57.91 a barrel.
Both crude benchmarks were down about 3% last week and hit their lowest settlements since October 21, as market participants worried that a Russia-Ukraine peace deal could lift sanctions on Moscow and flood the market with previously sanctioned supply.
“The sell-off was triggered mainly by President Trump’s forceful push for a Russia-Ukraine peace deal, which markets see as a fast track to unlocking substantial Russian supply,” IG analyst Tony Sycamore wrote in a note.
He added that moves toward a peace deal far outweighed the near-term disruption from U.S. sanctions on Rosneft and Lukoil that took effect Friday. The sanctions have stranded nearly 48 million barrels of Russian crude at sea.
On Sunday, the U.S. and Ukraine said they made progress during their talks on a peace plan that would require the war-torn nation to cede territory and walk back plans to join NATO. U.S. President Donald Trump has given a deadline of this Thursday, though European leaders are pushing for a better deal. A peace deal could roll back sanctions that have curbed Russian oil exports. Russia was the second-largest producer of crude oil in the world after the U.S. in 2024, according to the U.S. Energy Information Administration.
The threat of more oil coming to the market and uncertainty regarding U.S. interest rate cuts have also suppressed investors’ appetites.
However, the possibility of a rate cut next month increased after New York Federal Reserve President John Williams suggested a cut “in the near term.”
The greenback was headed for its biggest weekly rise in six weeks with the dollar index hitting its highest since late May. The stronger U.S. dollar makes oil more expensive for holders of other currencies.
