Oil prices rose on Tuesday, supported by concerns over supply disruptions from Russia and Iran due to Western sanctions and expectations of higher demand from China. Brent crude settled at $77.05 per barrel, up $0.75 (+0.98%), while U.S. West Texas Intermediate (WTI) closed at $74.25 per barrel, up $0.69 (+0.94%).
Traders cited tight post-holiday supplies and optimism over China’s stimulus plans as key drivers of the gains. Chinese port restrictions on U.S.-sanctioned vessels added to supply concerns, particularly for oil imports to major eastern terminals like Qingdao and Yantai. Additionally, Saudi Arabia raised its February oil prices for Asia, reflecting increased demand for Middle Eastern crude amid concerns about Iranian export disruptions.
Cold weather in the U.S. and Europe boosted heating oil demand, but global economic data tempered price gains. In the eurozone, higher-than-expected inflation in Germany raised doubts about the pace of European Central Bank rate cuts. Technical indicators showed oil futures in overbought territory, signaling potential selling pressure.
Despite these mixed signals, analysts pointed to a tight physical market with demand outpacing supply, which could lead to further inventory drawdowns globally. Market participants are now focusing on upcoming U.S. economic data, including the December non-farm payrolls report.