Oil Prices Rebound Ahead of U.S.-Russia Peace Talks

Oil prices rebound after recent losses, supported by anticipation of upcoming U.S.-Russia talks.

Oil prices rose on Monday, partially recovering from last week’s steep declines, as markets turned their attention to upcoming U.S.-Russia talks on the Ukraine conflict. Both benchmarks had fallen over 4% in the prior week.

U.S.-Russia peace summit in focus

A summit is set for August 15, with President Donald Trump meeting Russian President Vladimir Putin to discuss ending the war in Ukraine. The meeting comes amid increased U.S. pressure on Russia’s oil exports, particularly targeting top buyers China and India. Trump imposed tariffs of up to 50% on India to deter purchases of Russian oil and threatened similar measures against China.

Analysts at ING noted that with Russia demanding Ukraine cede occupied territories, a swift resolution remains unlikely. Any de-escalation could ease sanctions risks and weigh on oil prices, given the current bearish fundamentals.

Economic headwinds and inflation data

China’s July CPI was flat, while PPI fell more than expected, underscoring persistent deflationary pressures. Weak economic data, limited stimulus impact, and earlier trade-war de-escalation suggest muted demand from the world’s largest oil importer. July’s extreme weather also dampened activity.

Markets now await Tuesday’s U.S. CPI report for July, with signs of easing inflation potentially boosting expectations for a September Federal Reserve rate cut.