Oil prices fell on Tuesday, extending losses from the previous session, amid signs of a possible peace agreement between Russia and Ukraine, and the potential easing of sanctions on Russian crude.
Brent crude futures fell 0.5% to $60.24 a barrel.
Meanwhile, the price of US West Texas Intermediate crude reached $56.51 per barrel, down 0.5%.
US officials said the United States offered to provide security guarantees to Ukraine similar to those of NATO, in an unprecedented move that sparked optimism in some European capitals that talks are nearing the stage of negotiating an end to the conflict, according to Reuters.
In this context, Tony Sycamore, an analyst at IG, said in a note that pressure on prices was also exacerbated by weak Chinese economic data released overnight, which fueled concerns that global demand may not be strong enough to absorb the latest increase in supply.
Slowdown in industrial production growth in China
Official data released on Monday showed that China's industrial output growth slowed to its lowest level in 15 months, and retail sales recorded their slowest growth rate since December 2022.
These data have raised concerns that China’s strategy of relying on exports to offset weak domestic demand may falter, as a slowing economy could increase pressure on demand from the world’s largest oil importer at a time when the growing use of electric vehicles is already impacting crude consumption.
Conversely, these factors have eased concerns about supplies, after the United States seized an oil tanker off the coast of Venezuela last week.
