===== If Russia and Ukraine cease fire, oil prices may drop by 15%? =====

Citigroup believes that if Trump's peace plan for Russia and Ukraine ultimately succeeds, international oil prices may fall to $60-65 per barrel in the second half of 2025, a decrease of 15% from current levels.

According to a previous report by CCTV, on February 12, Eastern Time, U.S. President Trump spoke on the phone with Russian President Putin and Ukrainian President Zelensky. Both sides agreed to "closely cooperate" to end the Russia-Ukraine conflict and dispatched their respective teams to "immediately begin negotiations."

In a report on February 13, Citigroup stated that the Trump administration is formulating a peace plan aimed at resolving the Russia-Ukraine conflict. This plan may include forcing Russia and Ukraine to reach a ceasefire agreement by April 20, 2025. If this plan succeeds, it could lead to the lifting of some sanctions on Russia, thereby altering the supply and demand dynamics of the global oil market.

Since the outbreak of the conflict, the flow of Russian oil has changed significantly. According to Citigroup's estimates, the ton-mileage of Russian oil has increased by nearly 70 billion ton-miles. At the same time, demand for Russian oil from other countries, such as India, has surged, increasing by 800,000 barrels per day and 2 million barrels per day, respectively.

If Western countries relax sanctions on Russia and commit to restoring normal trade relations, Russia's oil production and exports could significantly increase. This would further alter the global oil supply landscape.

On the supply side, the sanctions currently imposed by the U.S. have resulted in approximately 30 million barrels of Russian oil being stranded at sea.

Citigroup believes that if the peace plan makes progress, these stranded oils, along with the oil backlog caused by changes in trade routes (approximately 150-200 million barrels), may be released into the market, further increasing supply pressure.

As a result, in the second half of 2025, Brent crude oil prices will likely be between $60 and $65 per barrel.

In addition to the Russian factor, Trump is also one of the downward pressures on oil prices.

Citigroup's research emphasized in the report that President Trump has consistently made lowering energy prices one of his top priorities. He has not only publicly promised to lower energy prices multiple times but has also pressured Saudi Arabia to increase production Citigroup believes that Trump hopes to lower Brent crude oil prices to around $60-65 per barrel, which is about 15% lower than the current price. This price level can meet the needs of both domestic and major foreign producers in the United States, while also alleviating pressure on the U.S. economy and consumers.

Citigroup estimates that if Brent crude oil prices fall to $60 per barrel (with WTI crude oil prices at $57 per barrel) in the fourth quarter of 2025, and the premium on petroleum products remains at current levels, the cost of U.S. petroleum product consumption will decrease by nearly $85 billion year-on-year, equivalent to about 0.3% of U.S. GDP.