Oil Fluctuates, Greenland Tensions Loom
Oil prices fluctuated slightly as the market weighed the impact of the US push to control Greenland. Brent held steady around $64 per barrel, while political tensions kept market participants cautious. Trump again attacked his allies on social media, and European leaders began signaling a strong response if the US actually implemented tariffs on the semi-autonomous Danish territory.
This escalation has pressured stock markets and pushed gold and silver to record highs. However, for oil, the impact remains minimal as the market focuses more on fundamental factors. "Growth concerns stemming from the threat of tariffs are weighing on risk sentiment," said UBS analyst Giovanni Staunovo. Essentially, if the trade war escalates, energy demand could weaken.
On the other hand, oil remains weighed down by concerns that supply will outstrip demand. The International Energy Agency estimates a significant surplus, possibly exceeding 3.8 million barrels per day, this year. However, supply disruptions helped cushion the decline, after Kazakhstan, the largest producer, briefly halted production at its Tengiz and Korolev fields following two fires at power plants.
Ahead of his speech in Davos on Wednesday, Trump reiterated his support for Greenland and expressed his belief that the European Union would not be too resistant. In the market, Brent crude for March rose 0.8% to $64.47 in London, while WTI for February (which expires Tuesday) rose 1% to $60.06. Furthermore, Middle Eastern oil prices are also starting to "go in the opposite direction": heavy oil has become cheaper than light oil, leading Asian refiners to prefer medium-sour oil for thicker margins. (alg)
Source: Newsmaker.id
