DTN Oil Update
Oil Steady as Trump Rules Out Use of Force in Greenland
SECAUCUS, N.J. (DTN) -- Crude futures steadied Wednesday, moving away from recent highs, after U.S. President Donald Trump ruled out the use of force to acquire Greenland.
The International Energy Agency's (IEA) forecast of a 4.25 million barrels per day (bpd) global surplus for the first quarter also weighed on the market.
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Offsetting some of the bearish sentiment was news out of Kazakhstan, where the operator of the Tengiz oilfield, TCO, declared force majeure on crude oil deliveries into the CPC pipeline system. Technical disruptions and fires at major fields have cut Kazakh output to around 1.5 million bpd, from a regular 1.8 million to 1.9 million.
The U.S. Dollar Index hit a session low of 98.18 against a basket of other currencies, not far from Tuesday's four-week low of 98.025, the largest one-day drop since the summer of 2025. A weaker dollar typically boosts commodities denominated in the greenback.
"Greenland was the headline risk," Stephen Innes of SPI Asset Management wrote as U.S. President Donald Trump arrived at the World Economic Forum in Davos, Switzerland, to push ahead with the U.S. campaign to acquire Greenland -- a bid which both the semi-autonomous Danish territory and the broader European community have rejected.
In a departure from his hostile language of recent days, Trump, however, told the Davos gathering the U.S. will not use force to acquire Greenland.
The Paris-based IEA raised its world supply growth forecast by 100,000 bpd from December's report to 2.5 million bpd. The energy watchdog also revised higher the demand growth forecast for 2026 by 70,000 bpd to 930,000 bpd on the back of normalizing economic conditions. These latest estimates imply a global oil surplus of 3.69 million bpd in 2026.
Market participants are also focused on U.S. oil inventory data for last week -- due at 4:30 p.m. EST Wednesday from the American Petroleum Institute, and on Thursday from the U.S. Energy Information Administration.
NYMEX WTI crude for February delivery slipped by $0.04, or 0.1%, to $60.32 barrel (bbl). The ICE Brent crude contract for March dipped by $0.07, or 1%, to $64.85 bbl.
Prior to the pullback, the two crude benchmarks had risen for four consecutive weeks.
Downstream, NYMEX ULSD futures for February delivery climbed by $0.0645 to $2.403 gallon, while front-month RBOB moved up by $0.0169 to $1.8407 gallon.