Putin told reporters Russia reserved the "right" to intervene in the
Ukraine crisis, but would only use force as a "last resort."
Coupled with news that Russian troops engaged in military exercises
near the Ukraine border were ordered to return to their bases, oil
prices slid from the five-month highs it reached Monday.
"The receding fears of a disruption of the Russian crude oil supply
and the easing geopolitical concerns are weighing on crude," said
Dwayne Pliska, senior trading consultant for HighGround trading in
April Brent crude settled $1.90 lower at $109.30 a barrel, after it
ended the previous session at its highest close this year.
U.S. crude for April delivery settled $1.59 lower at $103.33, after
rising to $105.22 on Monday, the highest level since Sept. 20.
Oil products prices retreated in tandem with U.S. crude. New York
ultra-low sulfur diesel futures, often called heating oil, fell
nearly 4 cents to $3.0407 per gallon, after it settled more than 6
cents higher at $3.0805 in the previous session.
U.S. gasoline RBOB fell by more than 3 cents to $2.9853 per gallon
after it settled more than 4 cents higher a day earlier.
U.S. commercial crude oil inventories rose by 1.2 million barrels
last week, in line with expectations, inventory data released by the
American Petroleum Institute showed on Tuesday. Stockpiles at
Cushing, Oklahoma, where the American benchmark is priced, fell by
2.6 million barrels, the data showed.
The government's Energy Information Administration will publish its
data on Wednesday at 10:30 a.m. EST.
[to top of second column]
Putin's statements raised investors' hopes for a peaceful resolution
with Ukraine. The crisis caused a sell-off in global equities on
Monday as investors worried the oil supply from Russia, the world's
second largest producer, could be disrupted or subject to sanctions.
Imports of Russian oil are so crucial for Europe that it is unlikely
sanctions will be imposed, said Seth Kleinman, head of energy
research at Citi.
In Libya, top officials production at the El Sharara oilfield may
resume as they are working to address protesters demands. Production
there has fallen to little over 200,000 barrels per day from 1.4
million bpd in July due to protests that closed the oilfield in the
eastern region of the country.
(Additional reporting by Simon Falush
and Shadi Bushra in London, Florence Tan in Singapore; editing by Marguerita Choy)
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