SULAIMANI (ESTA) — Oil prices dropped on Tuesday, extending losses from the previous day on signs of progress in talks between Russia and Ukraine to end their weeks-long conflict.
Brent crude fell $3.23 to $109.3 a barrel by 1602 GMT and U.S. West Texas Intermediate (WTI) crude was down $3.16 at $102.8.
Each benchmark lost about 7% both earlier in the session as well as on Monday.
Ukrainian and Russian negotiators met in Turkey for the first face-to-face discussions in nearly three weeks.
The top Russian negotiator said the talks were “constructive”, according to Reuters.
Russia promised at the peace talks to scale down its military operations around Kyiv and northern Ukraine, while Ukraine proposed adoption of neutral status but with international guarantees that it would be protected from attack.
However, Moscow’s lead negotiator cautioned that Russia’s promise to scale down military operations did not represent a ceasefire and a formal agreement with Kyiv had a long way to go.
“Maybe there’s reasons to be a bit more optimistic than we were this time yesterday, but I don’t think this whole situation with Ukraine is going to go away in the next 15 minutes,” Robert Yawger, executive director of energy futures at Mizuho, cautioned, adding that the $7 drop in oil prices earlier in the day was overdone, according to Reuters.
Sanctions imposed on Russia over its invasion of Ukraine have disrupted oil supplies, driving prices higher.