Crude prices plummet as geopolitical worries ease

Crude price fell Thursday as traders shrugged off the geopolitical risks of Ukraine.

The United States and the European Union agreed Tuesday to impose a new range of economic sanctions against Russia over the conflict in Ukraine.

Russia is an important oil production country, and most of Russian crude and gas exports to Europe pass through Ukraine. Despite the escalating tensions in Ukraine, there is no sign that crude production from the region will be disrupted.

Crude prices also followed declines in other commodities and stocks as Argentina missed a payment of its debt.

The No. 3 economy in Latin America defaulted following the failure of last-ditch talks with holdout creditors. Standard & Poor's Ratings Services Wednesday downgraded the country's foreign currency sovereign credit rating to "selective default" from "CCC-/ C."

In addition, the crude price was dragged down by the ample supplies in the United States last week.

U.S. gasoline increased 360,000 barrels to 218.2 million last week, the highest level since March 14, according to the Energy Information Administration (EIA). Peak summer driving season typically starts on the Memorial Day, which falls on May 26 this year, through to the Labor Day on Sept. 1. Analysts believe the fuel demand outlook is weak regarding the inventories level.

Light, sweet crude for September delivery slipped 2.1 U.S. dollars to settle at 98.17 dollars a barrel on the New York Mercantile Exchange, while Brent crude for September delivery lost 49 cents to close at 106.02 dollars a barrel.