Dec 12, 2025 (MarketLine via COMTEX) --
There was an overall decline in crude oil prices during the week on prevailing worries about global crude oil supplies outweighing demand in 2026. An increase in the OPEC+ crude oil production this year was one of the factors behind this consideration. But the key factor for next year could be the potential rollback of sanctions on Russia as Ukraine held talks with the UK, France, and Germany over the likely scenarios for a ceasefire in its protracted conflict. Nevertheless, tensions prevailed between the two countries as Russian oil infrastructure remained the focus on UkraineaEUR(TM)s latest strikes, thereby limiting the downside to oil prices during the week. Elsewhere, prices came under pressure from a notable rise in the US gasoline and distillate fuel stockpiles. But the US Federal ReserveaEUR(TM)s decision to slash interest rates for the third time this year lent hopes of a fuel demand revival and thus, somewhat arrested the fall in prices.
Some key factors that led to changes in crude oil prices this week are as follows:
Oil prices slid on Monday and Tuesday, weighed down by concerns over peace talks on the Ukraine conflict that would potentially lift the US and European sanctions on Russian crude oil. After holding discussions with key European leaders in London, Ukrainian President Zelenskiy announced that his administration would share a revised peace framework with the US. The country had earlier expressed concerns over security guarantees and cessation of its land that was currently under Russian control. Prices also came under pressure from persistent worries over surplus crude oil availability in global markets amid the recent hike in the OPEC+ production targets. This view was affirmed further after Lukoil restarted production at the West Qurna 2 oilfield in Iraq that would see around 500,000 barrels per day (bpd) of crude supplies reinstated in the markets.Oil prices rose slightly on Wednesday, supported by signs of simmering geopolitical tensions between the US and Venezuela. The US announced the seizure of an oil tanker in the Atlantic Ocean, offshore Venezuela, which sparked concerns over a possible retaliation from the South American nation. Prices also received support from a fresh Ukrainian attack on a tanker in the Black Sea – its third such attack in the last two weeks alone. Additionally, prices were buoyed by a 25-basis-point interest rate cut in the US, which would potentially provide more liquidity in its economy. However, the rise in prices was somewhat restrained by a large weekly gasoline inventory build in the US. As per the Energy Information Administration (EIA), gasoline stocks grew by 6.4 million barrels for the week ending on December 5, 2025. The country’s distillate fuel inventory also increased by 2.5 million barrels last week. Oil prices declined again on Thursday and then dipped slightly on Friday, weighed down in anticipation of progress in ceasefire talks in the Ukraine conflict. After meeting the Ukrainian President Zelenskiy earlier in the week, the heads of the UK, France, and Germany held discussions with the US President Trump on the peace proposal. Even a Russian minister commented that some misunderstandings were cleared when US representatives travelled to Moscow in the previous week. Russia also shared its expectations on security guarantees with the US, indicating that all parties were keen on taking the discussions forward towards a conclusive deal, which might ease the risks to Russian energy infrastructure and a likely rollback of sanctions on its energy exports. Nevertheless, Russian assets continued to bear the brunt of Ukrainian attacks – this time an oil rig in the Caspian Sea reportedly went offline after a drone strike.
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COMTEX_471218005/2227/2025-12-18T14:30:46
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