Trump Announces Energy Ceasefire as Oil Prices Fall

Global oil prices dropped more than 1% on Monday, October 12, 2026, after US President Donald Trump announced an immediate ceasefire covering energy infrastructure in Russia's war against Ukraine. The announcement reversed an earlier price surge triggered by deadly Houthi attacks in Saudi Arabia, even as Ukrainian officials reported fresh Russian strikes on power facilities and civilian areas.

Both major crude oil benchmarks declined following Trump's statement, according to Yahoo Finance. However, Moscow had not confirmed its participation in the proposed truce, leaving uncertainty over whether attacks on energy infrastructure would stop.

Trump announced the arrangement on Sunday through his Truth Social platform, declaring, "Effective immediately, there is an ENERGY CEASEFIRE in the War between Russia and Ukraine. Both parties have agreed. Do not break it!"

The announcement followed Trump's demand that Ukrainian President Volodymyr Zelenskyy stop attacks on Russian oil refineries. Trump had also criticized Zelenskyy and called for Ukraine to choose a different president to resolve the conflict.

Zelenskyy indicated that Kyiv had not received advance details of the proposed arrangement. He said he was seeking clarification while expressing support for a ceasefire if Russia also committed to it.

"Ukraine supports the ceasefire, and it is important that Russia support it as well," Zelenskyy said.

Despite the announcement, Ukraine reported continued Russian attacks on Sunday. Zelenskyy said a drone struck a power plant in Kyiv, causing electricity outages, while another attack targeted the CHP-5 power plant in Kharkiv.

"Ukrainian skies have been infested with Russian 'shaheds' [drones] all day," Zelenskyy said.

Ukrainian officials reported six deaths in strikes across two cities. Three people were killed when a Russian attack hit a grocery store in Kharkiv, while 20 others were injured, including two children, regional governor Oleh Syniehubov said. Three additional people died in a separate strike in western Ukraine.

The proposed energy truce received support from several Western allies, including the United Kingdom, France, Canada and the European Commission. British Prime Minister Andy Burnham described a sustained agreement as "the best route to get energy and fuel back into world markets," while French President Emmanuel Macron backed what he called a "real energy ceasefire."

The diplomatic developments followed controversy over a US decision to temporarily ease sanctions on Russian diesel as part of an agreement to purchase the fuel. Ukrainian officials and European allies criticized the move, arguing that it could strengthen Russian President Vladimir Putin's position.

Canadian Prime Minister Mark Carney reiterated his opposition after speaking with Zelenskyy on Sunday, saying the diesel agreement "is in direct opposition to the efforts of Ukraine, Canada and our allies to create peace and stability in Europe". European Commission President Ursula von der Leyen also expressed support for Zelenskyy, while German Foreign Minister Johann Wadephul said Berlin continued to "fully support" the Ukrainian leader.

Zelenskyy also rejected Trump's criticism of his leadership, emphasizing that the choice of Ukraine's president belonged to its citizens.

"First of all, with all respect to President Trump, it's up to our society, up to our people to choose one or another leader," Zelenskyy told ABC News.

Separately, the Financial Times reported that the Trump administration was considering suspending the procurement system used to supply Ukraine with weapons to pressure Kyiv to halt deep strikes on Russian energy infrastructure. European officials said Washington had been lobbying European capitals and Ukrainian authorities to end attacks on Russian refineries.

Oil markets had initially risen after a series of Houthi attacks on Saudi Arabia over the weekend. At least a dozen people were killed at Riyadh's international airport on Saturday, marking the deadliest attack on Saudi soil in more than a decade, while another person died following a second strike on Sunday.

The Iran-backed Houthis claimed multiple attacks over the preceding 24 hours and threatened further strikes against Saudi transport hubs, describing them as "a theatre of operations for our forces." The escalation added pressure to energy markets already facing uncertainty from the Russia-Ukraine conflict.

Market analyst Stephen Innes of SPI Asset Management said investors were becoming more selective in their response to geopolitical developments.

"The market is no longer paying full geopolitical premium on every headline, and that is probably the most useful signal in the morning price action," Innes wrote.

He noted that disruptions affecting actual oil supplies, shipping routes, refining operations or insurance costs remained more consequential than geopolitical announcements alone.

"The physical market remains tight enough to keep Brent above $100, but futures are refusing to treat every new escalation as the start of another straight-line inflation shock," Innes wrote.

Meanwhile, Russian military officials said their forces had struck a logistics center in Ukraine's Mykolaiv region and a cargo vessel in the Black Sea. Moscow claimed the center in Ternivka stored military and dual-use supplies intended for Ukrainian forces.

Russian and Ukrainian officials also reported separate attacks resulting in deaths on both sides of the border. Authorities in Russia's Belgorod region said a Ukrainian drone struck a car near the border, killing one person, while Russian-installed officials in occupied parts of Ukraine's Donetsk region reported one fatality from a Ukrainian attack.