Oil prices dropped more than 2% on Feb. 12 after U.S. President Donald Trump took a significant step toward ending the ongoing Russia-Ukraine war, which has contributed to higher oil prices due to concerns over global supply disruptions.
By 1:38 p.m. EST, Brent futures were down $1.71, or 2.22%, at $75.29 per barrel, while U.S. West Texas Intermediate crude dropped $1.78, or 2.43%, to $71.54. At their session lows, both benchmarks had fallen by more than $1 per barrel. The declines followed three days of gains, with Brent rising 3.6% and WTI increasing 3.7%, according to Reuters.
Trump addressed the war in Ukraine during phone calls with Russian President Vladimir Putin and Volodymyr Zelensky.
"Trump doing peace talks, I think that has taken some of the risk premium out of oil prices right now," Phil Flynn, a senior analyst with Price Futures Group, told Reuters.
Trump later confirmed on his social media platform that he and Putin had "agreed to have our respective teams start negotiations immediately, and we will begin by calling President Zelensky, of Ukraine, to inform him of the conversation, something which I will be doing right now."
Zelensky’s office said that the two leaders spoke for about an hour.
Following comments from Federal Reserve Chair Jerome Powell on Feb. 11 and new data showing that U.S. consumer prices rose more than expected in January, investors are trying to assess the central bank’s next move regarding interest rate cuts, Reuters reported.
"The combination of higher inflation and the possibility of peace (in Ukraine) is causing a bit of a sell-off in the market at the moment," Flynn told the news agency.
