Global crude oil markets ended the week in negative territory, as traders reacted to mounting expectations of progress toward a Russia–Ukraine peace agreement, fragile demand indicators from the United States, and easing fears over potential supply disruptions from Venezuela. While sporadic geopolitical tensions provided brief price support, they were insufficient to reverse the broader bearish momentum.
Brent crude, the international benchmark, settled the week at $59.67 per barrel, marking a 2.2 per cent decline from the previous Friday’s close of $61.02. Meanwhile, U.S. benchmark West Texas Intermediate (WTI) crude fell more sharply, sliding 4.3 per cent to $57.37 per barrel from $59.93 recorded a week earlier.
Market sentiment throughout the week was dominated by renewed optimism that diplomatic efforts to resolve the war in Ukraine could gain traction. U.S. President Donald Trump repeatedly urged Kyiv to “move quickly” toward a negotiated settlement, comments that reinforced investor expectations that sanctions targeting Russian crude exports could eventually be relaxed.
The outlook was further shaped by reports that Kirill Dmitriev, head of the Russian Direct Investment Fund, was expected to participate in upcoming talks involving U.S. and Russian representatives. Analysts interpreted this as a signal that Russian oil flows may remain uninterrupted—or even increase—over time, reducing the perceived risk of supply shortages.
Energy analysts noted that expectations of reduced sanctions pressure and fewer disruptions to Russian energy infrastructure have diminished the geopolitical risk premium that had previously supported oil prices.
Adding to the downward pressure, fresh data from the U.S. Energy Information Administration (EIA) pointed to subdued demand conditions in the world’s largest oil-consuming economy. According to the EIA, U.S. commercial crude inventories declined by approximately 1.3 million barrels during the week, significantly below market expectations for a draw of around 2.4 million barrels.
At the same time, gasoline inventories surged by about 4.8 million barrels, raising concerns about soft consumer demand amid seasonal and economic headwinds. U.S. crude production also edged higher by roughly 10,000 barrels per day, reinforcing perceptions of ample supply in the global market.
Oil prices briefly attempted to rebound following President Trump’s directive for a “full and complete” blockade of sanctioned Venezuelan oil tankers, alongside confirmation that U.S. authorities had seized vessels off Venezuela’s coast. However, the rally proved short-lived as markets observed no material disruption to actual oil flows.
Further easing concerns, Mexican President Claudia Sheinbaum publicly opposed any external military or economic intervention in Venezuela, calling instead for a peaceful, United Nations-led diplomatic resolution. Her remarks helped calm fears that tensions between Washington and Caracas could escalate into a supply shock.
Energy experts noted that diplomacy-focused statements reduced the likelihood of Venezuela-related disruptions, limiting the upside potential for oil prices. Although Venezuela currently produces around 1.1 million barrels per day, analysts stressed that its share of global oil trade remains relatively small, making sustained price support unlikely in the absence of broader supply constraints.
