Oil prices slip after rising on Trump-Zelenskyy meeting as Ukraine ceasefire remains elusive

US stocks little changed as traders await Jerome Powell's remarks later this week

Ukrainian President Volodymyr Zelenskyy and US President Donald Trump inside the oval office at the White House. AFP

Oil prices fell on Tuesday, following an increase on Monday after US President Donald Trump and Ukrainian President Volodymyr Zelenskyy expressed hope that talks with European leaders at the White House could pave the way for a trilateral summit with Russian leader Vladimir Putin to end Moscow's years-long invasion of Ukraine.

Brent, the global benchmark for crude, was down 0.95 per cent at $65.97 per barrel as of 2.20pm UAE time on Tuesday. West Texas Intermediate, which tracks US crude, was 0.88 per cent lower at $62.86.

Both benchmarks ended Monday about 1 per cent higher.

The talks held at the White House were expected to focus on security guarantees for Ukraine, a possible annexation of Ukrainian territory to Russia and a peace agreement.

“We are ready for a trilateral [meeting with Russia],” Mr Zelenskyy said during a meeting with Mr Trump.

At the meeting with Mr Trump and European leaders, he said he would be willing to have the US President present during a meeting with Mr Putin.

Ukrainian President Volodymyr Zelenskyy and US President Donald Trump during a bilateral meeting at the White House. Bloomberg

The hastily arranged meeting came days after Mr Trump and Mr Putin held talks in Anchorage, Alaska.

Oil prices surged to $140 a barrel in March 2022 after Russia's invasion of Ukraine, and sanctions imposed on Moscow by Washington and London. Prices fell in the months since with factors including an inflationary surge, a decrease in Chinese demand and fears of a global economic slowdown.

Mr Trump has lately sought to punish Russia by doubling the tariff rate placed on India to 50 per cent as New Delhi continues to buy oil and military machinery from Moscow. The latest tariff is due to go into effect in a couple weeks.

“India’s dependence on Russian crude is opportunistic and deeply corrosive of the world’s efforts to isolate Putin’s war economy,” White House trade adviser Peter Navarro wrote in an opinion piece for the Financial Times on Sunday.

“In effect, India acts as a global clearinghouse for Russian oil, converting embargoed crude into high-value exports while giving Moscow the dollars it needs.”

Eyes turn to Jackson Hole

Major indexes on Wall Street, meanwhile, were largely muted as traders awaited incoming economic data and Federal Reserve chairman Jerome Powell's address at Jackson Hole this week.

The Dow Jones Industrial Average dropped 33.93 points, or 0.08 per cent, when trading closed on Monday. The S&P 500 ticked 0.01 per cent lower while the Nasdaq Composite rose slightly at 0.03 per cent.

Mr Powell was due to speak at the annual symposium in Wyoming as traders increasingly expect the Federal Reserve to cut interest rates when it meets next month. The odds of a September rate cut have climbed considerably since a weaker-than-expected jobs report last month.

The Fed has held interest rates steady this year after cutting rates three times to its current range of 4.25-4.50 per cent in the final three months of 2024.

“The risk of an earlier cut increased following the release of the July employment report. However, of the Fed's two policy objectives, inflation is still furthest from its target and that gap is likely to widen as the full impact of tariffs becomes apparent in the data,” Oxford Economics lead analyst John Canavan wrote to clients.

US Federal Reserve chairman Jerome Powell, Bank of Canada governor Tiff Macklem and Bank of England governor Andrew Bailey break outside the Kansas City Fed's annual symposium in Wyoming in 2024. Reuters

The Fed is also due to release minutes from its July meeting on Wednesday, where traders will scrutinise a debate among Fed officials in which two governors dissented against last month's decision to hold rates steady.

Big-box retailers including Home Depot, Lowes, Walmart and Target were also scheduled to release their earnings reports this week.

Jobless claims and fresh housing data are due to be released before Mr Powell's keynote address on Friday.