Oil crept higher alongside global equities, bouncing off a one-month low as the White House signaled optimism about a peace deal between Russia and Ukraine, which could bring back Moscow’s barrels into an already saturated market.

West Texas Intermediate advanced 1.2% to settle above $58 a barrel, recouping most of the previous day’s losses. Volumes are still trending lower ahead of Thursday’s Thanksgiving holiday in the US.

Steve Witkoff, US President Donald Trump’s envoy, will lead a delegation for talks in Russia next week on ending the nearly four-year long war, a Kremlin official said. Ukrainian leader’s chief of staff said negotiations in Geneva had laid a “good foundation.” Yet any peace deal still face the same obstacles as in the past: What satisfies Ukraine is likely a deal-breaker for Russia, and vice versa.

Much of Russia’s oil and fuel is subject to heavy Western sanctions, with US restrictions on the two biggest producers kicking in last week. However, China, India and Turkey have been eager buyers of the discounted crude, so the impact on global prices from any lifting of curbs is hard to gauge.

“Minute adjustments between the US, Russia, Ukraine and the EU on proposed peace deals have been carefully digested by the market,” Standard Chartered analysts including Emily Ashford wrote in a note. “Any positive signs of collaboration or agreement have resulted in short-term sell-offs, while the dialing-back of enthusiasm has bolstered prices.”

In the US, meanwhile, the Energy Information Administration reported on Wednesday that overall crude inventories climbed by 2.8 million barrels, while gasoline and distillate inventories also expanded. That did little to assuage growing oversupply fears.

Oil has retreated by more than a fifth since the middle of June as the Organization of the Petroleum Exporting Countries and its allies restored barrels, while producers outside of the group also pumped more. Worldwide crude supply is expected to exceed demand by a record 4 million barrels a day next year, the International Energy Agency forecast this month.

Goldman Sachs Group Inc. said a peace deal may shave off about $5 a barrel from its base-case forecast of $56 next year. “That would put Brent in 2026 in the low $50s,” analyst Daan Struyven told Bloomberg TV.

What Bloomberg Strategists Say…

“Positioning remains defensive and volatility is low, which has helped anchor Brent in the $60 to $65 area for nearly two months. The peace talks add another source of supply risk and increase the chance of a move toward $60/barrel. That would then open the door for a new lower floor to be set.”

— Nour Al Ali, Markets Live strategist. For full analysis, click here.

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This article was generated from an automated news agency feed without modifications to text.