Recap: The crude market extended its early losses following the news that Ukraine agreed to a peace deal. The market posted a high of $58.96 on the opening and retraced some of Monday’s gains. However, the market sold off further, extending its losses to more than $1.70 as it posted a low of $57.10 by late morning. The market was pressured by news reports that Ukraine agreed on the terms of a potential peace deal. A Ukrainian official said Ukraine supported the essence of a framework for peace following talks with the U.S. in Geneva. However, the market bounced off its low and retraced some of its sharp losses as the Ukrainian official as well as the White House spokesperson stated that some of the most sensitive issues of the framework remained to be discussed between the two countries’ presidents. The oil market later retraced some of its losses during the remainder of the session as it traded back towards the $58.00 level. The January WTI contract settled down 89 cents at $57.95 and the January Brent contract settled down 89 cents at $62.48. The product markets ended the session lower, with the heating oil market settling down 5.23 cents at $2.3535 and the RB market settling down 3.94 cents at $1.8572.
Technical Analysis: The oil market on Wednesday will likely trade mostly sideways as the market retraces some of its losses ahead of the Thanksgiving Day holiday. The market will be driven by weekly petroleum stocks reports, which is expected to show builds across the board. It is expected to show a build of 1.4 million barrels in crude stocks. The market will also weigh any further updates regarding the Ukrainian peace deal as some sensitive issues still require further talks and it remains unclear if Russia will agree to the deal as well. The crude market is seen finding support at $57.10, $56.33, $55.99 followed by $55.41, $55.33 and $54.72. Meanwhile, resistance is seen at $58.91, $58.96, $59.06, $59.20, $59.47, $60.03, $60.10, $60.52, $60.70, $60.85, $61.01, $61.18 followed by $61.60 and $61.84.
Fundamental News: Ukraine’s President Volodymyr Zelenskiy said Ukraine was ready to advance a U.S.-backed framework for ending the war with Russia and discuss disputed points with U.S. President Donald Trump in talks he said should include European allies. U.S. President Donald Trump said he believed a deal on the war in Ukraine was getting very close.
Russian Foreign Minister, Sergei Lavrov, said that an amended peace plan for Ukraine must reflect the “spirit and letter” of an understanding reached between President Vladimir Putin and U.S. President Donald Trump at their Alaska summit. He said Russia had welcomed an initial version of a U.S. peace plan for Ukraine and was waiting for an amended interim version of the plan after Washington had coordinated with Ukraine and Europe.
Russia’s Deputy Prime Minister, Alexander Novak, said Russia sees the scope to increase oil exports to China and to deepen cooperation on supplies of liquefied natural gas.
Deutsche Bank sees a 2026 crude oil surplus of at least 2 million barrels per day and no clear path back to deficits even by 2027.
Three OPEC+ sources said OPEC+ is likely to leave output levels unchanged at its meeting on Sunday while focusing talks on a theoretical topic of how much oil its members can produce so the group can decide future policies. On Sunday, ministers are expected to discuss a mechanism to assess countries’ maximum production capacity, to be used as reference for 2027 output baselines. The eight members have raised output targets by around 2.9 million bpd from April to December and, at their last meeting in November, paused hikes for the first quarter amid predictions of a looming oversupply.
Platts reported that as the U.S. increases its military presence in the Caribbean, the chances of U.S. strikes within Venezuela could put at risk about 700,000 bpd of heavy crude exports and 300 billion barrels of reserves.
Early Market Call – as of 8:35 AM EDT
WTI – Dec $57.88, down 23 cents
RBOB – Dec $1.8665, up 1.13 cents
HO – Dec $2.3446, down 1.24 cents
