Oil price downward trend difficult to stop? Citigroup: Easing of Russia-Ukraine situation may cause oil to fall to $50.

According to Citigroup strategist Eric Lee, a potential easing of tensions between Russia and Ukraine could lead to oil prices falling to $50 per barrel. Lee stated in an interview on Friday that a de-escalation of the Russia-Ukraine situation would "push the market more quickly in the direction of Citigroup's bearish forecasts." This year, global benchmark oil price Brent crude has already fallen by about 18%, currently trading close to $61, mainly due to the long-anticipated supply glut beginning to show. Traders are closely watching the progress of high-level talks next week in the U.S. seeking to reach a ceasefire agreement. A breakthrough could lead to Western countries easing restrictions on Russia's energy industry and stopping Ukraine's drone attacks, which have severely damaged Russia's oil infrastructure. Citigroup's prediction implies a drop of about $10 per barrel in oil prices, which would threaten the shale oil industry. This industry requires higher oil prices than some state-run exploration companies to sustain drilling activities. Lee also pointed out that the situation of oil price decline raises a question: whether Saudi Arabia, as the de facto leader of OPEC, will take measures to protect oil prices or adhere to Washington's preference for lower oil prices. Lee said, "At such oil price levels, the willingness to use oil as a tool for foreign policy may be higher. If the oil price reaches $80 per barrel, people may not be as eager to take action against Iran or Russia, leading to a spike in oil prices. But when the oil price drops to $60 per barrel or even lower, the White House may be more courageous in taking more actions to disrupt oil supply."