West Texas Intermediate (WTI) crude extends its rally for a fourth straight session, trading near $59.80 during Asian hours on Wednesday. Oil prices are being supported by a temporary production halt at two major oilfields in Kazakhstan.
Kazakhstan, a key OPEC+ producer, suspended output at the Tengiz and Korolev oilfields on Sunday due to power distribution issues. According to industry sources cited by Reuters, production at both fields could remain offline for another seven to ten days, tightening short-term supply expectations.
However, upside momentum in oil prices may be capped by rising geopolitical and trade-related risks. US President Donald Trump reiterated his ambitions regarding Greenland and renewed threats of imposing 10% tariffs on eight European Union countries, fueling concerns over slower global economic growth and weaker oil demand.
In response, the European Union signaled potential retaliatory duties on up to $93 billion worth of US goods, with France reportedly pushing for the use of the bloc’s Anti-Coercion Instrument. Market participants also remain wary that Europe could leverage its roughly $10 trillion holdings of US assets, as reports suggest a Danish pension fund plans to reduce exposure to US Treasuries.
On the supply side, US crude and gasoline inventories are expected to have risen last week, while distillate stocks are forecast to decline ahead of the latest data from the US Energy Information Administration (EIA). Separately, US authorities seized a seventh Venezuela-linked oil tanker as part of intensified efforts to enforce sanctions and curb the country’s oil exports.
