Oil prices slide with profit-taking after rallying to 3-month high

Oil prices declined on Tuesday with investor profit-taking after reaching three-month highs over new US sanctions on Russia’s energy sector, while reports of a potential ceasefire in the Middle East also weighed in on prices.

The international benchmark Brent crude fell by 0.4%, trading at $79.79 per barrel at 11.24 a.m. local time (0824 GMT), down from $80.11 at the close of the previous session.

The US benchmark West Texas Intermediate (WTI) declined by 0.3%, falling to $77.02 per barrel, compared to its prior session close of $77.26.

Both benchmarks surged after the US administration sanctioned Russian oil producers Gazprom Neft and Surgutneftegas, over 180 vessels, many oil traders, and oil service providers on January 10.

The Treasury said the oil producers’ subsidiaries, some 80 organizations and individuals producing and exporting LNG were also sanctioned.

Oil markets are mixed due to uncertainty about the upcoming Trump administration and concerns that inflation may rise in the US. Today market players await US Producer Price Index (PPI) data.

Uncertainty about the new US administration’s policies is influencing expectations for the US Federal Reserve’s (Fed) interest rate cuts.

The Fed is expected to implement its first interest rate cut of the year in the second half of the year.

Meanwhile, news reports suggest that the ongoing conflict between Israel and Palestine is close to a ceasefire.

According to Palestinian sources, a ceasefire and prisoner exchange agreement for the Gaza Strip is ‘nearly ready’ and could be signed this week.

Reports by Israeli state broadcaster KAN suggested that Israel’s cabinet is likely to meet today to approve a ceasefire and prisoner exchange agreement for Gaza.

US President Joe Biden also spoke on the possibility of a ceasefire agreement in Gaza, saying ‘We are very close to finally seeing the ceasefire proposal made months ago come to fruition.’

• Oil Prices
• PPI
• WTI