Brent, WTI Prices Drop 2% as Trump Moves to End Russia-Ukraine War

By Adedapo Adesanya

The prices of the two major crude oil grades went down by more than 2 per cent on Wednesday after the US President, Mr Donald Trump, promised to end the Russia-Ukraine war that has supported oil prices on concerns about global supplies.

Brent futures depreciated by $1.82 or 2.36 per cent to trade at $75.18 a barrel and the US West Texas Intermediate (WTI) futures lost $1.95 or 2.66 per cent to finish at $71.37 per barrel.

President Trump discussed the war in separate phone calls with the Russian President, Mr Vladimir Putin and the Ukrainian President, Mr Volodymyr Zelenskiy.

He said both Presidents expressed a desire for peace in separate phone calls with him on Wednesday, adding that he has ordered top US officials to begin talks on ending the war in Ukraine.

This development came after the US said Ukraine has to give up its long-held goals of joining the NATO military alliance and regaining all of its territory seized by Russia, signalling a dramatic shift in the US’ approach to the conflict.

Meanwhile, investors gauged the Federal Reserve’s next moves on cutting interest rates following comments on Tuesday by its Chairman, Mr Jerome Powell and after data on Wednesday showed U.S. consumer prices increased more than expected in January.

Mr Powell said the economy is in a good place and the Fed is not rushing to cut rates further, but is prepared to do so if inflation drops or the job market weakens.

Consumer price data released by the US Labour Department showed surprisingly strong US inflation in January, stoking fears that a heating economy and looming tariffs could undercut hopes for rate cuts.

The CPI jumped 0.5 per cent last month, up from 0.4 per cent in December, and advanced 3.0 per cent in the 12 months through January after advancing 2.9 per cent in December.

Traders do not expect another cut until at least September, after previously chalking in a 25 basis points cut in June.

Higher rates can slow economic activity and dampen demand for oil.

The Organisation of the Petroleum Exporting Countries (OPEC) said in a monthly report that global oil demand will rise by 1.45 million barrels per day in 2025 and by 1.43 million barrels per day in 2026. Both forecasts were unchanged from last month.

The EIA increased its estimate for US crude production while leaving its demand forecast unchanged. It now expects US crude oil output to average 13.59 million barrels per day in 2025, up from its previous estimate of 13.55 million barrels per day.