Oil Prices Rise on Stronger US Demand, Peace Talks in Focus

Samuel Mobolaji

Oil prices edged higher on Wednesday as stronger US demand data and ongoing geopolitical negotiations shaped sentiment in the global energy market.

Brent crude gained 0.48 per cent to $65.92 per barrel from the previous close of $65.60, while US West Texas Intermediate (WTI) climbed 0.51 per cent to $62.27 from $61.95.

The uptick followed data from the American Petroleum Institute (API), which reported a 2.4 million-barrel drop in US crude stocks last week, double analysts’ expectations of a 1.2 million-barrel decline. Official figures from the US Energy Information Administration (EIA) are due later on Wednesday.

Investors also weighed progress in international peace efforts to end the Russia-Ukraine conflict. European Council President Antonio Costa reaffirmed EU coordination with the US on security guarantees for Ukraine after a virtual meeting with President Volodymyr Zelenskyy and US officials. Plans are underway for a direct meeting between Zelenskyy and Russian President Vladimir Putin within two weeks, followed by a possible trilateral summit.

While hopes of a ceasefire are reducing supply disruption risks, markets are also cautious that a peace deal could ease sanctions on Russian crude, potentially boosting global supply.

In parallel, trade tensions added to the complex backdrop. The US administration recently imposed a 25 per cent tariff on Indian goods in retaliation for New Delhi’s continued purchases of Russian oil, raising total duties on some imports to as high as 50 per cent. Talks between Washington and New Delhi scheduled for later this month are expected to influence energy flows and price direction.

Investors are also awaiting signals from the US Federal Reserve, with Chair Jerome Powell set to speak at the Jackson Hole Economic Policy Symposium on 22 August. Expectations of interest rate cuts remain a key factor for the oil demand outlook.