Recap: The crude oil market traded higher on Tuesday as the market weighed geopolitical risks and stronger than expected U.S. economic growth. The potential sales of Venezuelan crude seized by the U.S. were countered by increased supply disruption fears amid the continuing attacks between Russia and Ukraine. On Monday, President Donald Trump said that the U.S. may keep or sell the oil it seized off the coast of Venezuela as part of U.S. measures that include a blockade of oil tankers under sanctions entering and leaving Venezuela. Late Monday, Russian forces struck Ukraine’s Black Sea port of Odesa and damaged port facilities and a ship while Ukrainian drone attacks damaged two vessels and piers. The market traded mostly sideways before it breached its previous high and gradually traded to a high of $58.51 ahead of the close. The February WTI contract settled up 37 cents at $58.38 and the February Brent contract settled up 31 cents at $62.38. The product markets ended the session higher, with the heating oil market settling up 3.25 cents at $2.1906 and the RB market settling up 10 points at $1.7432.
Technical Analysis: The oil market is seen trading sideways barring any major news during Wednesday’s shortened trading session ahead of the Christmas Day holiday. The market is seen finding resistance at $58.51, $58.76, $58.83, $58.93, $60.01 and $60.12. Meanwhile, support is seen at $57.74, $56.60, $55.61, $55.08, $54.89 and $54.71.
Fundamental News: On Monday, U.S. President Donald Trump said it would be smart for Venezuelan President Nicolas Maduro to leave power, and added that the United States could keep or sell the oil it had seized off the coast of Venezuela in recent weeks.
According to company documents and shipping data, Venezuela’s state -run oil company PDVSA has started filling up tankers with crude and fuel oil it has in storage as inventories increase amid moves by the U.S. to seize Venezuela-linked ships. The emerging backlog, as PDVSA produces about 1.1 million bpd of crude, is quickly filling the company’s onshore tanks, especially at the Jose terminal, which receives extra heavy oil from the country’s main output region, the Orinoco Belt. PDVSA began draining part of those inventories to oil tankers over the past weekend. On Monday evening, Venezuelan President Nicolas Maduro said oil cargo deliveries for Chevron to export would continue even amid the dispute with Washington. Chevron has repeatedly said that its operations in Venezuela “continue without disruption and in full compliance with laws and regulations applicable to its business.”
Vortexa reported Monday that crude oil stored on tankers that have been stationary for at least 7 days fell -7% w/w to 107.15 million bbl in the week ended December 19.
Kpler is projecting EU countries will probably import some 4.62 million mt of diesel/gasoil this December, the lowest monthly total since February when the EU imported some 4.506 million mt.
Barclays said the oil markets are expected to remain well supplied in the first half of 2026, but added that the oil surplus will shrink to only 700,000 bpd in the fourth quarter of 2026 and that prolonged disruption could tighten the market further.
Baker Hughes said U.S. energy firms this week added oil and natural gas rigs for the first time in three weeks. The oil and gas rig count increased by three to 545 in the week ending December 23rd. Baker Hughes said the number of oil rigs increased by three to 409 this week, while gas rigs were unchanged at 127.
The EIA announced that its weekly petroleum stocks report for the week ending December 19th will be released on Monday, December 29th at 10:30 A.M. due to the closure of the Federal government for the Christmas holiday.
Early Market Call – as of 8:45 AM EDT
WTI – Feb $58.48, up 1 cent
RBOB – Jan $1.7463, down 42 points
HO – Jan $2.1842, down 76 points
