(Alliance News) - Oil prices declined on Monday as market participants awaited the uncertain outcome of US-led efforts to end the three-year war between Ukraine and Russia.

Brent crude oil was priced at USD66.02 a barrel on Monday afternoon in London, down from USD66.51 at the same time on Friday. West Texas Intermediate eased to USD63.08 a barrel from USD63.56.

The oil market remained in cautious mode after a meeting in Alaska on Friday last week between US President Donald Trump and Russia President Vladimir Putin, with focus now shifting to talks on Monday between Trump, and Ukraine President Volodymyr Zelensky, who will be accompanied by European leaders.

They include the UK's Keir Starmer, France's Emmanuel Macron, Germany's Friedrich Merz, Italy's Giorgia Meloni, and Finland's Alexander Stubb. Nato chief Mark Rutte and European Commission President Ursula von der Leyen will attend as well.

"It's unsurprising to see oil trading lower this morning following the Trump-Putin summit in Alaska," ING analysts Warren Patterson and Ewa Manthey said.

"While talks failed to secure a ceasefire, the tone and the absence of 'severe consequences' for the lack of a truce, reduce, or at least delay, the risks of stricter sanctions," Patterson and Manthey said, adding: "Ultimately, the reduced risk of tougher sanctions and secondary tariffs should allow bearish oil fundamentals to become the dominant driver for oil prices moving forward."

Before the Alaska meeting, Trump had warned Russia of tough sanctions if no deal was reached to end the Ukraine war, which began in February 2022.

"In fact, following the meeting, President Trump said he would hold off on secondary tariffs against China for its purchases of Russian oil, citing progress made over the weekend with Putin," ING analysts said.

"Ultimately, Russia still wants Ukraine to cede territory, something Ukraine will be very hesitant to do, particularly without very strong security guarantees from the US and Europe," ING's Patterson and Manthey said.

In other commodities, spot gold was quoted at USD3,348.23 an ounce on Monday, up from USD3,340.14 on Friday. Silver rose to USD38.13 an ounce from USD37.84.

The demand for the yellow metal remained strong on Monday, showing investors were cautious ahead of the Trump-Zelensky meeting, Swissquote analyst Ipek Ozkardeskaya said.

Investors will also likely remain cautious ahead of the Jackson Hole economic symposium in Wyoming, which starts from Thursday to Saturday.

US Federal Reserve Chair Jerome Powell will speak on Friday at this annual conference of central bankers, finance ministers, academics and financial market players from around the world.

In other metals, platinum was priced at USD1,332.60 an ounce on Monday, down from USD1,340.64 on Friday. Palladium was quoted at USD1,116.65 an ounce, down from USD1,130.40.

The copper price softened to USD9,735.00 per tonne from USD9,756.00. Aluminium inched down to USD2,602.50 from USD2,608.50.

By Artwell Dlamini, Alliance News senior reporter South Africa

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