DTN Oil Update

Maria Eugenia Garcia
DTN Energy Editor

HOUSTON (DTN) -- Oil futures edged up on Tuesday following the White House announcement that Russia and Ukraine had agreed to stop attacks in the Black Sea, which have disrupted oil exports and affecting global oil prices.

The White House informed on Tuesday that Russia and Ukraine "have agreed to ensure safe navigation, eliminate the use of force, and prevent the use of commercial vessels for military purposes in the Black Sea."

In two separate documents containing outcomes of talks between U.S. officials and Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskyy held in Saudi Arabia this week, the Trump administration stated that both leaders also agreed to "ban strikes against energy facilities on both countries."

It is unclear whether the United States will lift sanctions imposed on Russian oil trade after Russia invaded Ukraine in 2022 or if the price cap on Russian oil set by the G7 will be eliminated following this agreement.

In response to the announcement, the front-month NYMEX West Texas Intermediate futures contract for May delivery rose by $0.03 to $69.114 bbl while the May ICE Brent futures contract edged up by $0.14 to $73.14 bbl.

Downstream, April RBOB futures contract climbed by $0.0043 to $2.2109 gallon and April ULSD futures increased by $0.0325 to $2.2896 gallon.

Last week, the Trump administration imposed stricter sanctions on Iranian oil trade targeting a Chinese teapot refinery, 12 entities, one individual and eight vessels, which were shipping millions of barrels of oil produced by Iran to China.

On Monday, March 24, President Trump threatened to impose a 25% tariff on any country that purchases oil and gas from Venezuela, effective April 2, as the policies of the government of President Nicolas Maduro "pose a threat to the national security and foreign policy of the U.S."

Separately, the Conference Board reported Tuesday morning that U.S. consumer confidence declined for the fourth consecutive month in March, with the index dropping by 7.2 points to 92.9 from 100.1 in February.

The Expectations Index, which reflects consumers' short-term outlook for income, business, and labor market conditions, fell by 9.6 points to 65.2 its lowest level in 12 years.

Inflation expectations rose to 6.2% in March from 5.8% in February, with consumers citing high prices for essentials and concerns about tariffs.

Market participants await the announcement of new reciprocal trade tariffs to be imposed by the U.S. government on April 2 marks on China, Canada, Mexico, and the European Union -- all of which have imposed retaliatory tariffs on U.S. products.