Oil falls with talks to end the war in Ukraine and before the Fed meeting

Oil prices fell by as much as $4 a barrel on Monday, extending last week’s decline as diplomatic efforts to end the war in Ukraine intensified and markets prepared for a US interest rate hike.

Oil prices fell more than 5% on Monday to their lowest levels in nearly two weeks in hopes of progress toward a diplomatic end to Russia’s invasion of Ukraine, a development that would boost global supplies, while a pandemic-related travel ban in China cast doubt on demand.

While a new round of negotiations begins on Tuesday, with Russian and Ukrainian authorities announcing their intention to hold a new round on Tuesday, it appears that the Ukrainian presidential adviser has set the date for the end of the war.

Ukrainian presidential advisor Oleksiy Aristovich predicted that the war would end by next May, when Russia would run out of resources that it needs in its war on Ukraine.

Norway’s state oil company Equinor said on Monday it would stop dealing in Russian oil as the company halted its activities in Russia after its invasion of Ukraine.

The official announcement from Equinor comes four days after CEO Anders Obedal told Reuters that the company had stopped dealing in Russian oil.

Brent crude futures were last down $3.81, or 3.4 percent, at $108.86 a barrel at 0741 GMT on Monday.

US West Texas Intermediate crude futures also fell $3.85, or 3.5 percent, to $105.48 a barrel.

Both contracts have risen since Russia’s invasion of Ukraine on February 24 and nearly 40 percent so far this year.

Ukrainian and Russian negotiators are scheduled to speak again on Monday via video link after both sides signaled progress.