Crude Oil Futures Setback Nearly 6% Dragged Down By Double Pressure

Crude oil futures prices closed lower on Monday, with hopes for a diplomatic end to the Russian-Ukrainian crisis ignited and news that the US may lift the amount of oil sanctions against Venezuela subjecting oil prices to double downward pressure.

At 14:30 New York time on March 14 (02:30 GMT on March 15), NYMEX's most actively traded April crude oil futures fell $6.32, or 5.8%, to settle at $103.01 a barrel.

ICE's most actively traded May Brent crude contract fell $5.77, or 5.1%, to settle at $106.90 a barrel.

The May RBOB gasoline futures contract fell 14.61 cents to settle at $3.1339 per gallon.

The April heating oil futures contract fell 14.13 cents to settle at $3.2763 per gallon.

According to CNN, the Russian and Ukrainian delegations held their fourth round of talks via video on 14 local time. According to the latest news from CNN, the Ukrainian side revealed that the negotiations have been suspended and are expected to continue on the 15th.

Phil Flynn, senior market analyst at The Price Futures Group, said crude oil futures were sold off when Russia and Ukraine held their fourth round of talks early Monday morning. After the suspension of the negotiations, oil prices rebounded slightly.

In addition, Flynn said that on Monday there was news that the US would allow some oil-for-debt swaps from Venezuela, which would increase supply on the market. This has continued to keep oil prices in check.

Its view is that the Biden administration is eager to reach an agreement with Venezuela to lift oil sanctions, as domestic supplies of diesel fuel in the US are at historically low levels.

Sources say Chevron is prepared to take over operational control of its joint ventures in Venezuela if Washington eases sanctions on Caracas.

Ipek Ozkardeskaya, senior analyst at Credit Suisse Bank (Swissquote), said that "escalating tensions in Ukraine and negative pressure on oil prices are at play" as oil prices failed to break the $130 mark after the US and UK announced a ban on Russian oil last week. He noted that oil prices could fall further and that the $95 - $100 level should be closely watched.

Meanwhile, reports emerged on Sunday that Washington would not negotiate an exemption for Russia from Ukraine-related sanctions in order to revive the 2015 Iran nuclear deal and may try to reach a separate agreement that excludes Moscow.

Russia, which is involved in the negotiations on the nuclear deal, has been insisting that if the deal is revived, it will be exempt from Ukraine-related sanctions so that it can trade with Iran.