Russia-Ukraine talks hope oil falls $ 7, China locks

On March 4, 2013, a customer fills his car with diesel at a gas station in Nice. REUTERS / Eric Gaillard

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  • Ukraine and Russia have made rare progress in peace talks
  • China’s COVID cases this year are now higher than 2021
  • The UK is urging Saudi Arabia to increase oil production
  • India is ready to release more oil reserves

LONDON, March 14 (Reuters) – Oil prices fell $ 7 a barrel on Monday as investors hoped for a diplomatic effort to end the conflict between Ukraine and Russia, while markets were threatened by rising COVID-19 cases.

Brent was down $ 6.78 or 6% at $ 105.89 a barrel at 1358 GMT, while US crude was down $ 7.01 or 6.4% at $ 102.32.

Both criteria have risen since Russia’s February 24 occupation of Ukraine, and have risen to 40% to date.

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Ukrainian and Russian negotiators are due to speak again via video link on Monday. After the weekend talks the negotiators gave their most encouraging ratings, suggesting that there may be positive results within a few days. read more

“Apart from the new talks between Ukraine and Russia, I think the new locks in China are the reason for the negative start to the week for crude oil,” said UPS analyst Giovanni Stanovo.

The northeastern Chinese province imposed a rare travel ban on its population on Monday as the region’s Omigron eruption helped lift the number of new local COVID-19 cases in China so far this year to more than 2021.

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“(A) Oil prices are likely to remain moderate this week as investors continue to digest the impact of sanctions on Russia, with parties showing signs of negotiating a ceasefire,” said Tina Deng, a CMC markets analyst.

Russia’s oil and gas storage output rose to 11.12 million barrels per day (bpd) a day in March, despite the sanctions, two sources familiar with the production data told Reuters.

The United States has banned Russia’s oil imports and Britain has said it will suspend them by the end of 2022. Russia is the world’s largest exporter of crude and oil products, shipping about 7 million bpd, or 7% worldwide.

A senior minister has said British Prime Minister Boris Johnson is trying to boost Saudi Arabia’s oil production. read more

India has said it will take “appropriate” measures to stem the rise in oil prices, indicating that the country could release more oil from its national stockpile if needed. read more

Indian officials say New Delhi is considering a Russian offer to buy crude oil and other items at a discount through the rupee-ruble exchange. read more

Meanwhile, investors are watching this week’s meeting of the US Federal Reserve, which is expected to begin raising interest rates, which will push up the dollar and lower oil prices.

A strong greenback makes dollar-denominated oil more expensive for holders of foreign currencies.

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Bozorgmehr Sharafedin report in London, Emily Chow’s additional report in Beijing, Stephanie Kelly in New York; Editing by Susan Fenton and Jason Neely

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