Oil prices declined on Monday following President Donald Trump’s announcement of an “energy ceasefire” between Russia and Ukraine, whereby both nations agreed not to target each other’s energy facilities. Brent crude futures for December delivery fell 0.77% to $103.91 per barrel, while U.S. West Texas Intermediate crude for November delivery dropped 1.26% to $90.69 per barrel. Ukraine’s President Volodymyr Zelenskyy supported the ceasefire, emphasizing the importance of Russia’s compliance.

In addition to the ceasefire, Trump revealed a deal with Russia to resume supplying over 4 million tons of diesel fuel to the global market, which is expected to ease supply shortages contributing to price volatility. Meanwhile, tensions in the Middle East eased slightly as Iran expressed willingness to assist in initiating dialogue between Saudi Arabia and Yemen’s Houthi rebels, following recent attacks on Saudi targets. Iranian Foreign Minister Abbas Araghchi spoke with his Saudi counterpart Faisal bin Farhan about regional de-escalation.

Oil markets, however, remain unstable due to multiple factors. The ongoing conflict involving the Houthis and Saudi Arabia, including missile strikes that caused casualties and heightened risk perceptions in the region, continues to weigh on prices. Additionally, the approach of Hurricane Isaias, which intensified to a Category 3 storm with 120 mph winds near the U.S. Gulf Coast, has forced energy producers to cut offshore output, further threatening supply levels.

Looking ahead, the combination of geopolitical tensions and natural disruptions suggests that oil prices will experience continued fluctuations. While improved cooperation between Russia and Ukraine and diplomatic efforts in the Middle East could stabilize supplies, weather-related impacts and lingering regional conflicts are likely to keep the market unsettled in the near term. Traders and analysts will be closely monitoring these developments as they navigate the complex energy landscape.