Oil Prices Steady Near 5-Wk Low on Peace Deal Optimism


   
Karim Bastati
DTN Analyst

   VIENNA (DTN) -- Oil futures steadied Wednesday (11/26) morning after 
plummeting to their lowest in a month following progress in U.S.-led efforts to 
end the war in Ukraine.

   The NYMEX WTI contract for January delivery eased $0.07 bbl to $57.88 bbl, 
and ICE Brent for January delivery softened by $0.12 to $62.36 bbl.

   December ULSD futures retreated $0.0156 to $2.3382 gallon. Front-month RBOB 
gasoline futures bucked the trend, edging up $0.0066 to $1.8638 gallon.

   The U.S. Dollar Index strengthened by 0.096 points to 99.685 against a 
basket of foreign currencies.

   Ukrainian President Volodymyr Zelenskiy told European allies on Tuesday that 
he was supportive of the U.S. peace plan after delegations from both countries 
reworked some of the terms over the weekend. U.S. President Donald Trump said 
that "there are only a few remaining points of disagreement".

   It was unclear, however, whether Russia will accept amendments stemming from 
U.S. and Ukrainian discussions on the matter. According to Interfax, U.S. 
Special Presidential Envoy Steve Witkoff is set to visit Moscow next week.

   The end of sanctions on Russian oil may deepen the expected crude oil 
overhang next year. Together with the cessation of strikes on Russian 
downstream infrastructure, it will take pressure off a historically tight 
middle distillate market.

   Product inventories in the U.S., meanwhile, continued to expand last week, 
according to American Petroleum Institute (API) data released late Tuesday 
(11/25). API reported a 500,000 bbl build in gasoline inventories and an 
800,000 bbl expansion in distillate fuel oil inventories in the week ended 
November 21. In the prior week, gasoline and distillate fuel oil inventories 
grew by 2.3 million bbl and 700,000 bbl, respectively, according to U.S. Energy 
Information Administration data.

   Crude oil inventories fell 1.9 million bbl, according to API. This would 
mark the second consecutive weekly draw do commercial crude oil inventories if 
confirmed by weekly EIA inventory data scheduled for release at 1030am ET today.




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