U.S. oil prices under $55 a barrel lowest since 2021

by · UPI

Dec. 16 (UPI) -- U.S. crude fell below $55 a barrel Tuesday to its lowest since early 2021 as markets reacted to surplus concerns and potential peace deal in Ukraine.

West Texas Intermediate fell to a low of $54.98 a barrel to its weakest level since early February 2021, and recently traded near 55.16, down about 2.9%.

Brent crude, meanwhile, slipped to $58.88 a barrel in a nearly 3% drop. It slid roughly 21%, marking its weakest year since 2020.

U.S. crude was down about 23% this year at its steepest annual drop since 2018.

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The AAA reported that U.S. gasoline had fallen below $3 a gallon, the lowest in four years.

Oil prices were sliding as OPEC boosted output after years of restraint, while investors bet on easing geopolitical tensions as U.S. President Donald Trump pushes for some kind of Russia-Ukraine peace deal.

It also arrived as the Trump administration advances drilling licenses on public lands in opposition to environmental groups.

"Oil markets will be watching developments closely, given the significant supply risk from sanctions on Russia. While Russian seaborne oil exports have held up well since the imposition of sanctions on Rosneft and Lukoil, this oil is still struggling to find buyers," two ING commodity strategists wrote Tuesday in a note.

The president has stated a deal supposedly could be "closer now than we have been ever."

"The result is a growing volume of Russian oil at sea. India, a key buyer of Russian oil since the Russia/Ukraine war began, will reportedly see imports of Russian crude fall to around 800k b/d this month, down from around 1.9m b/d in November," they added.

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President Donald Trump and first lady Melania Trump attend the Congressional Ball in the Grand Foyer of the White House on Thursday. Photo by Shawn Thew/UPI | License Photo