West Texas Intermediate (WTI), the US crude oil benchmark, is trading near $59.85 during early European hours on Friday. Prices are edging higher as broad US Dollar weakness and an improved risk appetite lend support to the market.
The US Dollar has softened after President Donald Trump eased tariff rhetoric and ruled out the use of force in relation to Greenland, helping to calm global market sentiment. Trump also noted that the United States and NATO have established a framework for a potential future agreement concerning Greenland.
“US Dollar weakness is providing some support to oil prices,” said Warren Patterson, Head of Commodities Strategy at ING Groep NV. “While the broader market outlook remains bearish, ongoing geopolitical uncertainties and supply-side risks are delaying a sustained move lower.”
However, gains may be capped as US crude inventories increased last week. According to the US Energy Information Administration (EIA), crude stockpiles rose by 3.602 million barrels for the week ending January 16, following a 3.391 million-barrel build previously. This came well above market expectations of a 1.1 million-barrel increase, potentially weighing on WTI prices going forward.
