Oil Prices Update: Market Movements and Geopolitical Influences
Crude oil contracts for March delivery saw an upward adjustment, with Brent crude gaining 38 cents to reach $77.25 per barrel as of 0110 GMT. The most actively traded April contracts were positioned at $76.23 per barrel, reflecting a rise of 34 cents. Meanwhile, US West Texas Intermediate (WTI) crude increased by 49 cents, standing at $73.22 per barrel.
In terms of weekly performance, projections indicate a potential decline of 1.6% for Brent crude while US WTI is expected to decrease by 2%. However, both benchmarks are anticipated to show gains for the month of January, with Brent up by 3.6%, marking the most favorable monthly performance since June. US crude is projected to rise by 2% during the same period.
In a separate development, the administration has threatened to impose a 25% tariff on oil imports from Canada and Mexico starting Saturday if those countries do not curtail shipments of fentanyl across the border. The administration’s leader has stated that a decision concerning the exclusion of Canadian and Mexican oil from these tariffs will be made shortly.
Market analyst Daniel Heinz from an Australian bank commented on the fluctuations in crude oil prices, noting that investors are sensitive to the potential implementation of US tariffs and a series of executive directives. Heinz elaborated that the geopolitical landscape significantly influences oil prices, particularly regarding the administration’s foreign policies. The restrictions placed on Russian oil, the cessation of Venezuelan oil purchases, and intensified measures against Iran contribute to raised geopolitical risks, all of which are likely to sustain elevated oil prices.
Heinz also pointed out that ongoing regulations concerning strategic oil reserves amplify demand for crude oil, representing another factor that could impact market dynamics.