By Julia Fanzeres and Alex LongleyBloomberg Posted on March 29, 202229 Mar 2022 Oil sank as Russia said it was taking steps to “de-escalate” the conflict in Ukraine, citing a meeting between President Vladimir Putin and Ukrainian counterpart Volodymyr Zelensky. New York Mercantile Exchange futures fell more than $ 7, falling just under $ 100 a barrel before combining some losses in the latest sequence of huge fluctuations in the oil market. Moscow has said it will cut short military operations near the Ukrainian capital, Kyiv, even though troops have been stranded there for weeks. Russia’s chief negotiator has said he is willing to consider a presidential meeting between Putin and Zelensky. Kyiv has been seeking direct talks for some time, while Moscow has resisted commitments to include Putin. “Major traders and investors have removed their chips from the crude table due to the extremely high volatility, leaving the main players in the market to be traders who want to hedge geopolitical risks,” said Rebecca Babin, senior energy trader at CIBC Private Wealth Management. Developments with the war in Ukraine and the subsequent sanctions against Russia have caused extreme price fluctuations in the oil market, leaving investors wary of trading. For the month of March, the WTI averaged over $ 9 per session, another indication of the liquidity problems currently facing the market. Prices were also milder on Tuesday as China battled Covid’s biggest outbreak since the pandemic began. The latest restrictions in Shanghai could reduce oil demand by up to 200,000 barrels a day during the embargo, Rystad Energy consultant said in a report. “We are still in a $ 100 environment, no doubt,” Paul Sankey of Sankey Research in New York told Bloomberg TV. “China is removing heat from the market, but if the heat returns, it adds $ 10 a barrel. Prices
WTI for May delivery fell $ 3.35 to $ 102.61 at 10:45 a.m. in New York Brent crude for May delivery lost $ 3.76 at $ 108.72 a barrel
Crude oil has been trading at more than $ 100 a barrel since Moscow invaded Ukraine over concerns that supply from one of the world’s largest producers would be cut off. The big oil companies, including Shell Plc and TotalEnergies SE, have already announced plans to finally stop trading Russian oil and the value of the country’s barrels has fallen. Related coverage:
Saudi Arabia and the United Arab Emirates have said the United States must trust OPEC +’s strategy, as Washington and other major importers call on the group to increase oil production following Russia’s invasion of Ukraine. Saudi Arabia, the world’s largest oil exporter, is likely to increase pricing of its main crude variety on record as the impact of Russia’s invasion of Ukraine resonates in markets more than a month after the attack. Saudi Arabia’s foreign direct investment peaked at more than a decade last year, rising sharply mainly thanks to the oil pipeline deal in the second quarter.
