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Oil Steadies as Greenland Ruckus Fades and Supplies Tick Higher

(Bloomberg) -- Oil steadied as geopolitical tensions over Greenland cooled, aiding wider markets and offsetting an array of issues over supply.

Global benchmark Brent traded above $65 a barrel after a 2% rise over the last two days, while West Texas Intermediate was near $61. US President Donald Trump said he would hold back from imposing tariffs on Europe over the Arctic island, saying the framework of a potential deal had been reached.

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Oil has ticked higher in the opening weeks of the new year, supported largely by a wave of unrest in Iran, which has now subsided, as well as interruptions to shipments from Kazakhstan. The advance has come despite widespread concerns that global crude supplies will top demand following sustained output increases by members of the OPEC+ alliance as well as rivals.

The International Energy Agency on Wednesday maintained its view for a major glut this year, although it nudged up its estimate for demand growth. In the US, meanwhile, one of the most data-transparent markets for oil, stockpiles rose by 3 million barrels last week, according to the American Petroleum Institute, an industry group. Official data on holdings are due later Thursday.

Wider output issues continued to weigh on the outlook. The Caspian Pipeline Consortium terminal is now set to restart, pushing loadings higher just as Venezuelan supply makes its way back into the global market. Indian private refiner Reliance Industries Ltd., meanwhile, has once again purchased Russian crude, with deliveries in February and March.

“We saw some interest in buying Brent and WTI crude following Trump’s Davos speech and social-media posts,” said Chris Weston, head of research at Pepperstone Group, referring to remarks from the US leader at the World Economic Forum, as well as comments on Greenland. Still, “there is little conviction to chase the move aggressively. The supply backdrop continues to act as an overhang, limiting upside follow-through,” he added.

Elsewhere, the US was said to be actively seeking a regime change in Cuba by the end of the year, the Wall Street Journal reported on Thursday. The Trump administration has assessed Cuba’s economy as being close to collapse after losing a vital benedector in Venezuela’s Nicolas Maduro, it added.