Oil rises on Kazakh supply disruptions, upbeat economic data; Greenland in focus

Published Wed, Jan 21, 2026 · 06:04 AM

[NEW YORK] Oil prices rose on Tuesday on the temporary suspension of output at Kazakhstan’s oil fields and expectations of firmer global economic growth that could drive fuel demand. Investors continued to monitor US President Donald Trump’s tariff threats against European states that oppose his push to acquire Greenland.

Brent futures settled 98 cents, or 1.53 per cent, higher at US$64.92 a barrel. The US West Texas Intermediate crude contract for February, which expires on Tuesday, gained 90 cents, or 1.51 per cent, at US$60.34.

The more actively traded WTI March contract rose US$1.02, or 1.72 per cent, to US$60.36. Kazakh oil producer Tengizchevroil, led by Chevron, said on Monday it had temporarily halted production at the Tengiz and Korolev oilfields after an issue affected power distribution systems.

Tengiz field could be halted 7-10 days

Tengiz could be halted for another seven to 10 days, cutting crude exports via the Caspian Pipeline Consortium, sources told Reuters on Tuesday.

“Tengiz is amongst the largest fields in the world and so the outage is certainly disruptive for crude flows,” said Ajay Parmar, director of energy and refining at ICIS. “But this disruption does look to be temporary, and so if the tariffs rhetoric continues, we expect prices to fall back,” he said.

The oil market also drew support from better-than-expected fourth-quarter Chinese gross domestic product data released on Monday, said IG market analyst Tony Sycamore.

“This resilience in the world’s top oil importer provided a lift to demand sentiment,” he said.

China’s economy grew by 5 per cent last year and the country’s refinery throughput in 2025 climbed 4.1 per cent on a year-over-year basis, data showed on Monday. China’s crude oil output also grew 1.5 per cent.

Prices also gained on an upward revision of this year’s global economic growth estimate by the International Monetary Fund as well as stronger diesel prices, said PVM analyst Tamas Varga. A sliding dollar has also supported prices, as a weaker US currency could boost oil demand by making dollar-denominated purchases cheaper.

Trump’s tariff threats

Fears of a renewed trade war escalated over the weekend after Trump said he would impose additional 10 per cent levies from Feb 1 on goods imported from EU members Denmark, Finland, France, Germany, Sweden and the Netherlands, as well as Britain and Norway, rising to 25 per cent on June 1 if no deal on Greenland was reached.

Trump’s tariff threats have a negative bearing on crude prices as the levies could lead to lower global economic growth and therefore reduce oil demand growth, said Parmar of ICIS. European Commission President Ursula von der Leyen said on Tuesday that the bloc’s executive arm is working on a package to support Arctic security and that the tariffs are a mistake. REUTERS