The meeting between Vladimir Putin and Donald Trump was not a breakthrough, but it went well, and both sides look forward to further progress. Moreover, Moscow opened the door a crack so that American ExxonMobil could return to Russia. This relaxes energy markets, where Russia plays a key role. Mining countries, however, are not very happy about the situation, as prices are declining.
Oil
The meeting between Vladimir Putin and Donald Trump in Alaska has relaxed the oil market. The cost of the benchmark North Sea Brent has also decreased over the week — from $ 66.6 to $ 65.8.
Negotiations in Alaska did not end with a peace deal, but both sides were satisfied. Donald Trump said that not all points have been agreed, but he supports the idea of a peace agreement, not a truce.
Such a move did not stop the conflict on Ukraine, but gave hope that everything is going in the right and peaceful direction. The reason for the oil market to lower prices for raw materials was given by Russia itself. The Russian president signed a decree according to which the American ExxonMobil can return its stake in the Sakhalin-1 project, albeit with conditions.
At the same time, the data from China again prevented oil from falling even lower.
"Chinese government data showed that industrial production growth fell to an eight—month low, and retail sales growth increased at the slowest pace since December, which affected sentiment despite an increase in oil refining in the country, which is the second largest consumer of oil in the world," writes Reuters.
Experts told the agency that the oversupply of oil in the world could reach 890 thousand barrels per day. This is a lot, but even more is needed to restore the strategic reserves of Western countries.
Gas
Gas in Europe was getting cheaper even faster than oil. Deliveries for a month in advance from the TTF exchange decreased — from $ 395 per thousand cubic meters to $ 379. This is the lowest price in the last 16 months.
"Natural gas prices in Europe have fallen to their lowest level in more than a year ahead of the historic summit between US President Donald Trump and Russian President Vladimir Putin," writes Bloomberg.
They noted that few traders foresee the imminent return of Russian pipeline gas to Europe — even if a ceasefire agreement is reached on the Ukraine.
"Any tightening or easing of sanctions on Russian energy carriers could have serious consequences for global supplies," traders said.
The situation in Europe has not become attractive for coal companies. Prices were also falling. Deliveries for a month in advance from the Antwerp-Rotterdam-Amsterdam hub (ARA) decreased from $ 101 per ton to $98.