International crude oil prices fell on Monday as investors assessed risks of supply disruptions from escalating U.S.-Venezuela tensions, global oversupply worries, and potential impacts from a possible Russia-Ukraine peace deal.
The January WTI (West Texas Intermediate) crude futures on the New York Mercantile Exchange dropped 62 cents, or 1.08%, settling at $56.82 per barrel. Meanwhile, the January Brent crude contract declined by 56 cents, or 0.92%, closing at $60.56 per barrel.
Both benchmarks had already lost over 4% the previous week, pressured by expectations of a global oil supply surplus in 2026.
John Evans, an analyst at PVM, noted, "Oil prices continued their downward trend last week, hitting their lowest levels this month in major futures markets. Without recent U.S. escalation against Venezuela, prices might have been even weaker."
Shipping data, documents, and maritime sources indicate that Venezuela's oil exports have significantly declined since the U.S. seized a tanker early last week and imposed new sanctions on shipping companies and vessels doing business with the Latin American oil producer.
Markets are closely monitoring developments and their potential impact on oil supply. Reports suggest the U.S. plans to intercept more vessels carrying Venezuelan oil following this week's tanker seizure, intensifying pressure on President Nicolás Maduro.
Ukrainian President Volodymyr Zelensky held a five-hour meeting with a U.S. envoy in Berlin on Sunday, expressing willingness to abandon Ukraine's bid to join NATO. Negotiations are set to continue Monday.
U.S. envoy Steve Wittkopf described "significant progress" but provided no further details. A peace deal could eventually lead to increased Russian oil supplies, currently under Western sanctions.
Takashi Ueno, senior economist at NLI Research Institute (affiliated with Japan's Nippon Life Insurance Group), stated, "Sentiment around Russia-Ukraine talks oscillates between optimism and caution, while escalating U.S.-Venezuela tensions raise concerns about potential supply disruptions."
Growing expectations of oversupply also weighed on oil prices. JPMorgan's commodities research team noted in a Saturday report that the projected oil surplus in 2025 is expected to widen further in 2026-2027, with global supply growth outpacing demand growth—potentially reaching three times the demand growth rate by 2026.
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