BY COMFORT OGBONNA
Oil prices crept higher on Tuesday, buoyed by rising geopolitical unease tied to Iran and increasing fears of supply interruptions, even as traders weighed the likelihood of additional barrels entering the market from Venezuela.
The shift in sentiment pushed crude benchmarks close to their highest levels in months, reflecting how swiftly oil reacts to global political tensions.
Brent crude climbed 28 cents, or roughly 0.4%, to reach $64.15 a barrel in early Asian trade, hanging just below a two-month high set the previous day. U.S. West Texas Intermediate also rose by 28 cents, or 0.5%, to trade at $59.78 a barrel, marking its strongest performance since early December. The steady rise highlights persistent uncertainty clouding energy markets at the start of the year.
One of the most immediate concerns stems from unfolding events in Iran. The country, a key oil producer within the Organization of the Petroleum Exporting Countries, has been plunged into its most serious wave of anti-government protests in years.
Reports of violence against demonstrators have prompted strong reactions from Washington, including warnings of military repercussions. President Donald Trump has convened top advisers to weigh possible responses, underscoring how political decisions made in distant capitals can ripple through the energy marketplace.
Trump went even further on Monday, declaring that any nation doing business with Iran should expect a 25% tariff on transactions tied to U.S. markets. Such pronouncements amplify the risk that escalating pressure on Tehran could choke off exports and tighten global supplies. Analysts estimate that the unfolding crisis is adding several dollars per barrel in a geopolitical premium, a cost baked into current pricing as traders brace for additional volatility.
Yet oil markets are not reacting to Iran alone. Venezuela—another sanctioned nation with vast oil reserves—has re-entered the global conversation after dramatic political changes. Following the removal of President Nicolas Maduro, the new government is reportedly preparing to send up to 50 million barrels of crude to the United States, pending sanctions clearance. Global commodity houses have surged to the forefront, positioning themselves ahead of larger U.S. energy companies to secure control over these flows. The development injects potential new supply into a market already grappling with uncertainty.
Meanwhile, friction between other major powers has added another layer of unease. Reports from Ukraine indicated that Russian forces struck the country’s two largest cities early Tuesday, resulting in casualties and raising fresh alarm over regional instability. Although the immediate impact on oil production is limited, such events contribute to a broad atmosphere of geopolitical risk that traders cannot ignore.
In the U.S., markets also absorbed domestic political tension as the Trump administration publicly criticized the Federal Reserve once again. Renewed attacks on the central bank have stirred worry about economic policy direction and the pace of global demand.
The combination of international flashpoints and U.S. policy uncertainty sets the stage for considerable oil price swings in the coming weeks as traders attempt to balance risk against supply realities.
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