"Peaceful prospects push oil prices lower, yet Russia's firm position and ongoing attacks continue to unsettle markets"

Oil prices experienced a significant decline on Tuesday after reports emerged of a possible U.S.-mediated peace agreement between Ukraine and Russia, fueling speculation that Western sanctions on Moscow's energy exports might be lifted. Brent crude futures dropped by 2.3% to $61.92 per barrel, while West Texas Intermediate (WTI) crude decreased 2.5% to $57.40 per barrel,

. The price drop followed news that Ukrainian President Volodymyr Zelenskiy could soon travel to the U.S. to finalize the deal, although Russian authorities have yet to confirm their approval of the proposed terms .

The market's reaction highlights wider concerns about a potential influx of Russian oil if sanctions are removed. Over the weekend, U.S. and Ukrainian representatives met in Geneva, , while Russian negotiators held separate talks in Abu Dhabi. that a peace agreement could enable Russia to ramp up output to OPEC+ quotas and release oil currently stored in tankers offshore, which has built up due to limits on sales to European buyers.

Despite some positive sentiment, doubts remain.

it will not yield on its military objectives, and a wave of missile attacks on Kyiv on Tuesday highlighted the delicate nature of ongoing diplomacy. "It takes both sides to reach an agreement, and it's still uncertain whether Russia will consent," . At the same time, that even with a peace deal, a global oil surplus of at least 2 million barrels per day is projected for 2026, with no clear solution for rebalancing before 2027.

The prospect of relaxed sanctions has also led to changes in other commodity markets.

per megawatt-hour for the first time in over a year, as traders anticipated less competition from Russian oil and gas. Industrial metals such as copper and aluminum, which surged at the war's outset, have responded variably as global trade flows adjust. Western markets to Russian suppliers, but analysts warn that ongoing geopolitical tensions and long-term trends like China's gold accumulation could dampen demand.

Analyze the historical performance of OIL indices using the MACD Golden Cross strategy from 2022 to the present.

to reduce Russian oil purchases have been influenced by U.S. sanctions targeting Rosneft and Lukoil. that Russian oil exports have fallen, with more crude being stored in tankers, which could flood the market if restrictions are lifted. Meanwhile, to boost shipments to China, indicating a strategic shift should Western sanctions persist.

With traders preparing for continued market swings, the outlook for peace remains unpredictable. While the U.S. and Ukraine press on with talks, Russia's position and the risk of renewed conflict have kept oil prices unstable. "The outlook for 2026 is still bearish,"

. For now, investors are closely monitoring for any developments—positive or negative—in the ongoing Ukraine conflict.