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West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $58.65 during the Asian trading hours on Tuesday. The WTI loses ground as the United States (US) pushes for a peace plan between Ukraine and Russia to end the three-year war. Oil traders brace for the release of the American Petroleum Institute (API) weekly crude oil stock report, which is due later on Tuesday. 

The US peace proposal to end the Russia-Ukraine war weighs on the WTI price. Ukraine's President Volodymyr Zelenskiy stated on Monday that negotiations had reached a "critical moment," indicating that debates about territory and sovereignty would be challenging. 

“We should expect a nervous oil market ahead of Thanksgiving on Thursday,” said Arne Lohmann Rasmussen, chief analyst at A/S Global Risk Management. “Several factors point to a peace agreement or possibly a ceasefire moving closer over the weekend, which supports further price declines this week.”

On the other hand, rising bets of a US interest rate cut in December might help limit the WTI’s losses. US Federal Reserve (Fed) Governor Christopher Waller said on Monday that available data indicate that the labor market remains weak enough to warrant another quarter-point cut. 

The probability of a Fed rate cut next month surge to 80% on Tuesday after falling to 30% in the previous week, according to the CME FedWatch Tool. Lower interest rates generally weigh on the US Dollar (USD) and lift the WTI price, as it makes USD-denominated commodities cheaper for foreign buyers. 

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