Oil prices remained stable on Tuesday as markets weighed competing pressures from geopolitical tensions and economic data. Brent crude held at $64 per barrel while West Texas Intermediate traded below $60.
President Donald Trump renewed his push to acquire Greenland over the weekend. The move has created tension with European allies and raised concerns about potential trade conflicts.
Trump announced plans to impose 10% tariffs on goods from eight European countries starting February 1. The affected nations include Denmark, Norway, Sweden, France, Germany, the Netherlands, Finland and Britain.
BREAKING: President Trump says he had a "very good phone call" with the Secretary General of NATO regarding Greenland and he has agreed to a meeting with "various parties" in Switzerland.
President Trump is preparing for step #8 of our tariff playbook with perfect timing. https://t.co/C0ekCuXoxN pic.twitter.com/APwRs4L9wQ
— The Kobeissi Letter (@KobeissiLetter) January 20, 2026
The tariffs would increase to 25% by June 1 if no agreement on Greenland is reached. Trump stated “we have to have it” when referring to the island during comments ahead of his appearance at the World Economic Forum in Davos.
The tariff threats have bruised the US dollar and created uncertainty in global markets. “The market is not pricing a full retaliation between the US and the EU, and it’s likely that a compromise will be found,” said Mukesh Sahdev, CEO at XAnalysts Pty Ltd.
China released economic data on Monday showing 5.0% GDP growth for 2025. The figures came in better than market expectations and provided some support to oil prices.
China’s crude oil output grew 1.5% year-on-year in 2025. The data from the world’s top oil importer helped lift demand sentiment among traders.
“This resilience in the world’s top oil importer provided a lift to demand sentiment,” said IG market analyst Tony Sycamore. The International Monetary Fund also revised its global economic growth estimates upward for this year.
Oil markets continue facing pressure from oversupply concerns. Physical crude grades in the Middle East have declined in price as OPEC+ producers raise output levels.
The International Energy Agency has warned repeatedly about a potential glut in 2025. The agency is set to publish its next market analysis on Wednesday.
“The outlook for a large surplus suggests prices should trend lower, while the potential for a further escalation in US-EU tensions poses further downside risk,” said Warren Patterson, head of commodities strategy at ING Groep NV. A weaker US dollar and firm timespreads have provided some support to oil despite broader risk-off moves in markets.
Some tightness remains in specific physical markets. Issues at the Caspian Pipeline Consortium port in the Black Sea have created supply constraints.
Kazakhstan’s Tengiz oil field is also experiencing problems. These factors are contributing to a near-term shortfall of crude from the Mediterranean region.
Markets are watching Venezuela’s oil sector after Trump said the US would run the industry following the capture of Nicolas Maduro. Vitol offered Venezuelan oil to Chinese buyers at discounts of about $5 per barrel to ICE Brent for April delivery
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