Putin pitches three-way Ukraine talks with Trump and Xi at APEC, without Kyiv

For oil, the headline risk runs in both directions. A serious move toward a Ukraine settlement would normally reduce the risk premium tied to Russian supply, but the proposed summit has yet to be confirmed, and energy specialists see the Iran war, not Russia, as the primary cause of diesel prices. The US diesel arrangement is therefore unlikely to help product markets much. Ukraine's strike on an oil terminal in St Petersburg, along with continued pressure on Russian refineries, keeps product-supply risk alive for the near term. A softer US posture on Russian sanctions would be a mild bearish factor for crude over time if it lets more Russian barrels move freely. For the Australian dollar, any sign of reduced great-power friction on Chinese soil would be somewhat supportive for risk appetite, though the impact is likely modest until a meeting is confirmed.

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Earlier:

• Oil slips as Trump waives Russia energy sanctions while Hormuz tanker blast offsets the move

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Putin is seeking to turn his warming relationship with Trump into a great-power agreement on Ukraine with no place for Kyiv, but without a US commitment and with Beijing nervous about the fallout, it remains a proposal, not a plan.

Summary:

• Putin has proposed a three-way meeting on Ukraine involving Trump and Xi, reportedly to be held on the margins of the November 18-19 APEC summit in Shenzhen
• The Kremlin has confirmed talks but says there is no clear agreement on whether the meeting will happen or what its agenda would be
• A senior US official says Trump has not agreed, though he might be open to it given his pledge to end the war
• The idea came up in an October 9 call that also led to a deal for the US to buy Russian diesel and help market it
• Trump has paused sanctions on Russia that were due under a recently signed law and has intensified criticism of Zelensky
• China reportedly would not object if Trump takes part, though Beijing worries about overshadowing APEC and straining ties with Europe

Russian President Vladimir Putin has pitched a three-way meeting next month with US President Donald Trump and Chinese President Xi Jinping to discuss ending the war in Ukraine, an arrangement that would exclude Kyiv and, according to people familiar with the talks, is aimed at securing terms favourable to Moscow, the Wall Street Journal (gated) reported.

The proposal arose during an October 9 phone call between Putin and Trump, according to a former Russian intelligence officer briefed on the matter. The same call produced an agreement for the US to buy Russian diesel and help sell it worldwide. The Kremlin has suggested that the talks be held on the margins of the Asia-Pacific Economic Cooperation summit in Shenzhen, set for November 18 and 19.

Only a limited amount is confirmed. Kremlin spokesman Dmitry Peskov did say talks on a possible meeting are under way, but noted there is still no clear understanding of whether it will take place or what its scope would be. A senior US official said Trump has accepted no such summit, although he could be receptive given his promise to end the conflict, now in its fourth year. Beijing has reportedly signalled it would not object if Trump participates.

The proposal comes as Washington and Moscow have clearly warmed to each other. On Friday, Trump paused sanctions on Russia that were due under a bipartisan law he signed last month, drawing criticism from legislators, including some allies. He has also intensified pressure on Ukrainian President Volodymyr Zelensky, calling for an end to attacks on Russian refineries after Kyiv struck an oil terminal in St Petersburg on Sunday.

The diesel agreement is meant to relieve fuel costs that have weighed on the US economy before the midterm elections. Energy experts, however, largely view the Iran war as the main driver behind higher diesel prices and expect the Russian volumes to have little impact on the market.

For Xi, hosting such talks would reinforce China's drive to be seen as a global power broker, but there are risks. Chinese officials fear a parallel event could take attention from APEC and hurt commercial links with Europe, a region already suspicious of Beijing's ties to Moscow. Analysts add that three leaders bargaining over Ukraine's future in Kyiv's absence could heighten concern in Taiwan.

The next signposts will be a formal White House response and a place for the session on the APEC schedule. A clear US commitment would signal a big change in Western diplomacy over Ukraine, while saying no would leave the largely stalled US-led peace effort as the only active route.

When it comes to outmanoeuvring, the pair can easily run rings around a certain someone.