Summary
- Trump steps back from tariff threats over Greenland
- IEA revises up forecasts for 2026 global oil demand growth
- US crude stocks up by 3.04 million barrels last week, API says
(Reuters) – Oil prices slipped on Thursday, reversing the previous sessions’ gains, after U.S. President Donald Trump softened threats against Greenland and Iran, and as investors assessed the supply and demand outlook.
Brent crude was down $1.07 cents, or 1.6%, at $64.17 a barrel at 1123 GMT. West Texas Intermediate for March declined $1.02 cents, or 1.7%, to $59.60 a barrel.
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The contracts climbed more than 0.4% on Wednesday following a rise of 1.5% a day earlier, after OPEC+ producer Kazakhstan halted output at its Tengiz and Korolev oilfields due to power distribution issues.
“There is a deflation of risk premium related to the Greenland debacle and Iran supply risk has also been reduced,” said Ole Hansen, chief commodity analyst at Saxo Bank.
On Wednesday, Trump ruled out the use of force to acquire Greenland and stepped back from tariff threats aimed at European allies.
Trump also said he hoped there would be no further U.S. military action in Iran, but added the United States would act if Tehran resumed its nuclear programme.
Against the backdrop of Greenland and the receding prospect of action in Iran, oil prices should hold at around $60 a barrel, said Tony Sycamore, an analyst with online broker IG.
Also Wednesday, Trump said he believed “we’re reasonably close” to a deal to end the war between Russia and Ukraine, adding he would meet Ukrainian President Volodymyr Zelenskiy later in the day.
An end to the war would likely result in the removal of U.S. sanctions on Russia, which would limit supply disruptions and weigh down prices.
The International Energy Agency revised its 2026 global oil demand growth forecasts higher on Wednesday in its latest monthly oil market report, suggesting a slightly narrower surplus this year.
U.S. crude and gasoline stocks rose, while distillate inventories fell last week, market sources said on Wednesday, citing figures from the American Petroleum Institute.
Crude stocks rose by 3.04 million barrels in the week ended on January 16, according to the API, said the sources, who spoke on condition of anonymity.
Gasoline inventories rose by 6.21 million barrels, while distillate inventories fell by 33,000 barrels, the sources said.
Eight analysts polled by Reuters forecast an average rise of about 1.1 million barrels in crude inventories for the week to January 16.
“High crude inventories are limiting further gains in oil prices in an oversupplied market,” said Yang An, an analyst at Haitong Futures.
Reporting by Anna Hirtenstein in London. Additional reporting by Sam Li in Beijing and Siyi Liu in Singapore; Editing by Clarence Fernandez, Thomas Derpinghaus and Joe Bavier
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