Oil prices stabilized Friday as Brent crude reached $63.34 per barrel, despite facing headwinds from increasing global supplies and ongoing geopolitical uncertainty. The market is closely watching potential shifts in the Russia-Ukraine conflict and upcoming OPEC+ decisions, factors that could significantly alter the supply landscape and impact energy costs for consumers and businesses worldwide. This comes after both major crude benchmarks are poised to record their fourth consecutive monthly decline-the longest such streak since 2023-raising concerns about global economic growth and demand.
Contributing to the price stability were signals of potential easing in monetary policy by the US Federal Reserve, sparking hopes for increased economic activity and, consequently, higher oil demand. Additionally, a decrease in the number of active oil rigs in the United States to a four-year low provided some support. Though, the overarching narrative remains dominated by the possibility of increased supply stemming from a potential peace agreement between Russia and Ukraine.
Russian President Vladimir Putin stated Thursday that draft peace proposals discussed between the United States and Ukraine could serve as a foundation for future agreements, though he affirmed Russia woudl continue fighting absent a resolution. He also noted that US President’s special envoy Steve Witkoff plans to visit Moscow early next week. Simultaneously, Ukrainian President Volodymyr Zelensky announced that American and Ukrainian delegations will meet this week to refine a peace formula discussed in Geneva, aiming to secure security guarantees for Kiev.
Looking ahead, OPEC+ is expected to maintain current oil production levels at its meeting sunday, while also exploring a mechanism to evaluate the maximum production capacity of its member states, according to sources within the group. Despite these developments, both Brent and West Texas Intermediate crude are currently on track to close the week with gains exceeding 1%.
