Prices eased after Trump said preparations were underway for a trilateral summit with Russian President Vladimir Putin, Ukrainian President Volodymyr Zelenskyy
Oil prices slipped on Tuesday after comments by US President Donald Trump and Ukrainian President Volodymyr Zelenskyy fueled expectations that the war in Ukraine could move toward a resolution and sanctions on Russian crude could be eased.
International benchmark Brent crude fell 0.77% to $65.63 a barrel at 10.10 a.m. local time (0710 GMT), down from $66.14 at Monday's close.
US benchmark West Texas Intermediate (WTI) decreased 0.79% to $62.11 per barrel, compared to $62.61 in the previous session.
Prices retreated after Trump said preparations had begun for a trilateral summit with Russian President Vladimir Putin and Zelenskyy, which he would also attend.
Zelenskyy reiterated he is ready for bilateral talks with Putin ahead of a broader format involving the US and European leaders.
German Chancellor Friedrich Merz said following the meeting in Washington, which included European leaders, that Zelenskyy and Putin were expected to meet within two weeks.
The announcements eased market concerns over supply flows and weighed on prices.
Analysts said that while a ceasefire or peace deal is not imminent, the progress in negotiations has reduced geopolitical tension.
Meanwhile, investors also turned their focus to US trade measures against India, after the Trump administration announced on Aug. 6 a 25% penalty tariff on Indian goods over New Delhi's purchases of Russian oil.
The levy, which takes effect on Aug. 27, will raise total tariffs on many Indian imports to as much as 50% and has stalled trade talks between Washington and New Delhi.Peter Navarro, a counsellor for trade and manufacturing at the White House, on Monday called India's "dependence" on Russian crude "opportunistic and deeply corrosive of the world's efforts to isolate Putin's war economy."
New Delhi has pushed back on US tariffs, calling the Trump administration's moves "unfair and unjust."
According to Navarro, India's purchases of Russia's crude oil had climbed to over 30% of its total imports, from a mere 1%, since the Ukraine war began in February 2022.
He also accused India of "now cozying up to both Russia and China."
"India's oil lobby is funding Putin's war machine, that has to stop," he added.
According to analysts, Indian refiners are likely to continue buying Russian crude as long as it remains economically viable. They added that late-August talks between the US and India, if they go ahead, could prove decisive for market sentiment.
Investors are also watching the Federal Reserve's annual Jackson Hole Economic Policy Symposium, set for Aug. 21-23, where Chair Jerome Powell's remarks will be parsed for clues on the path of rate cuts.
