Friday 17/October/2025 – 12:33 AM
Oil fell to its lowest level in five months after US President Donald Trump announced that he would meet his Russian counterpart, Vladimir Putin, to discuss ways to end the war in Ukraine, raising expectations that Russian crude may return to flowing freely soon.
According to Bloomberg, the price of Brent crude for December delivery fell by 1.4% to close at $61.06 per barrel, while West Texas Intermediate crude fell by 1.4% to settle near $57 per barrel, its lowest level since May.
Trump announced on social media that the United States and Russia will hold high-level talks next week focused on ending the war, followed by a summit between the two leaders in Budapest.
Pressure on Russia’s oil exports
The possibility of reaching a truce between Russia and Ukraine comes amid mounting pressure on Russia’s oil infrastructure. Russia’s exports of refined products have fallen to their lowest levels since the beginning of the war, which reflects continued pressure on the country’s refineries that are being attacked by Ukrainian drones.
At the same time, Western countries are escalating their measures against the Russian energy sector in an attempt to limit the flow of oil revenues to the Kremlin and reduce Putin’s ability to finance the war.
The United Kingdom recently imposed sanctions on the largest Russian oil companies, in addition to two Chinese energy companies and the Indian oil refinery Nayara Energy Limited, due to their dealings with Russian fuel.
India and China between sanctions and reduced supplies
This development weakened the previous wave of rise in prices, after Indian oil refiners said they expected to reduce, not stop, their purchases of Russian crude, a step that could lead to a tightening of global supplies, following statements by Trump in which he stated that India would stop all purchases.
India, along with neighboring China, has benefited from deep discounts on Russian supplies available under the G7 price cap mechanism, which is designed to keep oil flowing while limiting Moscow’s access to financing.
Demand declines and fears of excess supply increase
Oil fell this month as trade tensions escalated between the United States and China, raising concerns about demand in the world’s largest crude consumers, at a time when major trading companies said that the long-expected surplus was already beginning to appear.
JPMorgan Chase analysts wrote in a note on Thursday that the weakness in oil demand seen in early October continued through the second week, with activity continuing to decline at U.S. and Chinese ports.
In China, the slowdown was largely caused by the Mid-Autumn Festival holiday, while in the United States, it reflected the end of the pre-sourcing phase and the impact of higher tariffs, they added.
