Crude oil prices eased over 1.5 percent, after US President Donald Trump announced a Russia-Ukraine energy ceasefire, although uncertainty over the deal and continued hostilities raised questions about how much of this is indeed going to be implemented. Brent Crude prices traded at 102 dollars per barrel (at the time of filing this copy).
Experts believe expectations of more Russian supplies after US President Donald Trump said Ukraine and Russia had agreed to halt attacks on each other’s energy facilities following a US diesel-supply deal with Moscow boosted sentiment, until latest reports of fresh attacks began emerging.
For India, the implications of the Trump-Putin diesel deal also extend beyond the immediate impact on oil prices to the cost and availability of fuel ahead of winter, when demand for diesel typically rises in several major markets. Any additional Russian fuel supplies that ease pressure on global markets could help moderate price volatility, although the benefit for India would depend on how much supply reaches the market, freight and insurance costs, and the extent of disruption to other oil flows.
Senior Economist, Mitali Nikore told Times Now Digital, “diesel runs our trucks, farms and freight, and it is nearly 30% of the world’s oil use. Right now the world is short of about 1.6 million barrels of diesel a day compared with February, because Gulf and Russian exports have fallen. Winter makes it harder. In the US, diesel and heating oil use in January and February is about 3% above the yearly average, and fuel stored on the East Coast is 20 to 30% below normal. As per the terms of this new deal, Russia has committed to about 125,000 barrels a day, far short of 1.6 million. Most of it also depends on Russia’s damaged refineries recovering. This may calm prices for a few weeks. But the wider shortage will last until Gulf exports and Russian refineries recover. The bottom line-this deal shows that Trump will do business with anyone to bring fuel prices down, even the Russians, a month after signing a sanctions law against the country!”
