Oil prices slipped on Friday, settling at one-month lows as markets reacted to Washington’s renewed push for a Russia-Ukraine peace framework and uncertainty around the direction of U.S. interest rates. Brent fell $0.82 to $62.56, while WTI lost $0.94 to $58.06, with both benchmarks down about 3% for the week and back to levels last seen on October 21.
The diplomatic pressure weighed heavily on sentiment. The Trump administration has urged Kyiv to consider a U.S.-drafted plan that would require territorial concessions and limits on Ukraine’s military — terms the Zelenskiy government has long rejected. Even so, Kyiv signaled it would at least review the proposal, raising questions about whether upcoming sanctions deadlines on Russia’s top oil producers might be softened if talks progress. Moscow, for its part, said the plan could be the basis for a settlement but warned it would push deeper into Ukraine if Kyiv declines.
A peace deal remains uncertain, but the possibility of increased Russian oil flows was enough to lean the market toward oversupply concerns, especially with sanctions on Rosneft and Lukoil taking effect Friday and Lukoil facing a December 13 deadline to divest foreign assets. Traders also noted skepticism over how strictly these restrictions will be enforced.
A firmer U.S. dollar added pressure, with the currency hitting a six-month high and making crude more expensive for non-U.S. buyers. Meanwhile, mixed signals from Federal Reserve officials kept investors cautious: several policymakers suggested rates may need to stay on hold longer, while others said cuts remain possible in the near term. The lack of clarity weighed on overall risk appetite.
Economic data added to the cautious tone. U.S. factory activity slowed in November as higher import costs from new tariffs dampened demand and pushed inventories higher, raising additional concerns about near-term fuel consumption.