Oil prices and energy stocks fall sharply on Trump’s new Ukraine peace plan

Oil prices extended declines and energy stocks fell sharply on Friday as U.S. President Donald Trump pushed for a peace deal to end the long-running Russia-Ukraine war.

International benchmark Brent crude futures with January expiry slipped 2.2% to $62 per barrel at 3:02 p.m. London time (10:02 a.m. ET). The contract dipped 0.2% in the previous session.

U.S. West Texas Intermediate futures with January expiry were last seen 2.6% lower at $57.46, after closing Thursday off 0.5%.

Europe’s Stoxx Oil and Gas index, meanwhile, slipped more than 2.4%. Britain’s Shell and BP were both trading around 1.4% lower. Norway’s Equinor fell 2.3%, while Germany’s Siemens Energy plunged nearly 8%.

U.S. oil giants Exxon Mobil and Chevron traded 1.1% and 0.6% lower, respectively, on Friday.

The bearish market sentiment comes as investors pore over the details of the Trump administration’s push to secure a peace deal between Russia and Ukraine.

The U.S., under a widely leaked plan, has reportedly proposed that Ukraine cede land including Crimea, Luhansk and Donetsk, and pledge never to join the NATO military alliance.

The plan also says Kyiv will receive “reliable” security guarantees, while the size of the Ukrainian Armed Forces will be limited to 600,000 personnel, according to The Associated Press, which obtained a copy of the draft proposal. CNBC has not been able to independently verify the report.

Analysts were doubtful that the peace plan, which is thought to be favorable toward Russia, would be backed by Ukraine.

Guntram Wolff, senior fellow at Bruegel, a Brussels-based think tank, was among those skeptical about whether the proposed peace plan could lead to a deal.

“I think it’s always good to talk each other so in that sense it’s a good development but I have to say when I saw the details of this supposed peace plan, I really don’t think it can fly,” Wolff told CNBC’s “Europe Early Edition” on Friday.

“Because at the core, what it says is that Ukraine should give up significant parts of its military personnel, meaning the military personnel would decrease by something like a third from 900,000 to 600,000,” he added.