Oil prices climbed on broader risk appetite and rising expectations of a December Fed rate cut, while markets closely tracked evolving Ukraine peace talks that could reshape the supply outlook, ING's commodity experts Ewa Manthey and Warren Patterson note.

Brent gains as markets watch Ukraine peace talks

"The Oil market received a boost from a broader risk-on move, with equities rallying and the market pricing in a higher probability of the US Federal Reserve cutting interest rates on 10 December. As a result, ICE Brent settled almost 1.3% higher on the day."

"However, the market continues to pay close attention to how peace talks to end the war in Ukraine develop. Reports suggest that there have been significant changes to the proposed peace plan, with the US and Ukraine essentially drafting a new one. The more contentious points, such as those related to territory, will need to be ironed out by President Trump and President Zelensky."

"Obviously, Russia must agree on any deal. For Oil markets, a deal could remove significant supply risk, leaving participants to focus on bearish supply fundamentals through 2026."