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Oil Prices Climb as Ukraine-Russia Peace Efforts Falter and Sanctions Loom

 Oil prices saw a modest rise this week, breaking a three-week losing streak, as tensions in the ongoing Ukraine-Russia conflict flared up once again, casting uncertainty over a potential peace deal.

A Week of High Stakes and Tense Talks

Despite market hopes for progress, attempts to broker peace between Ukraine and Russia remain in a deadlock. President Donald Trump, currently leading U.S. diplomatic efforts, hinted at organizing a summit between Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy. However, no date or agenda has been confirmed, and Russia’s Foreign Minister Sergei Lavrov accused Ukraine of refusing key negotiations.

"Everyone is waiting for President Trump's next step," said UBS commodity analyst Giovanni Staunovo. The lack of movement on a ceasefire is making energy markets nervous, especially with the possibility of new, tougher U.S. sanctions on Russia if the war drags on.

Oil Market Responds to Geopolitical Risk

By Friday’s close, Brent crude futures edged up 0.09% to $67.73, and WTI crude rose 0.22% to $63.66. Both contracts posted weekly gains—Brent up 2.9% and WTI up 1.4%.

The increase follows Ukraine’s latest military strike on Russian energy infrastructure, including a refinery and the Unecha pumping station—an important link in the Druzhba oil pipeline, which supplies Europe. Russia temporarily halted oil shipments to Hungary and Slovakia, with disruptions expected to last at least five days.

Such events tighten oil supply in an already cautious market. A recent drawdown in U.S. crude inventories added further upward pressure on prices.

Europe Watches Closely, and So Does the Market

While Trump has pledged to protect Ukraine under any war-ending deal, Zelenskiy has dismissed the idea of surrendering any territory. Meanwhile, Estonia offered to send peacekeeping troops, signaling growing European involvement.

Analysts from ING noted that the less likely a ceasefire becomes, the higher the risk of sanctions, which could further restrict Russian oil exports and strain global supplies.

Oil tankers loading crude at Iraq’s Basra terminal as tensions between Ukraine and Russia shake global supply chains. (REUTERS/Mohammed Aty)


Looking Ahead

Investors and energy analysts will be watching closely in the coming days for signs of diplomatic progress—or further escalation. As global markets remain on edge, one thing is certain: oil prices will continue to react sharply to headlines from Eastern Europe.

  • Oil prices posted weekly gains after three straight weeks of decline.
  • Peace negotiations between Russia and Ukraine remain stalled.
  • Ukraine’s strike on Russian energy infrastructure disrupted oil supplies to Europe.
  • Market volatility remains high amid fears of new U.S. sanctions on Russia.




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