WTI continues to hold steady above $59.00 as the market assesses tensions in Iran and possible tariff threats from Trump. West Texas Intermediate (WTI), the US crude benchmark, is trading around $59.30 in early European hours. Traders are looking forward to the API crude oil stockpiles report set for Tuesday. Over the weekend, tensions in Iran subsided slightly, although their Supreme Leader reported many casualties from recent protests. Observers are eagerly waiting for news on US-Iran relations, especially with reports of US military movements towards the Middle East, alongside Trump’s suggestion to delay any action against Iran.

Tariff Effects on Europe

Trump recently imposed a 10% tariff on imports from several European countries, effective February 1, pending discussions about Greenland. European leaders are expected to meet to discuss possible responses, as Trump’s tariffs on Europe could affect market dynamics and WTI pricing. If the upcoming API report shows a decrease in stockpiles, it might boost WTI prices. However, an increase in stockpiles could signal reduced demand, potentially causing prices to drop. WTI oil, often called “light” and “sweet,” is primarily sourced from the US and serves as a crucial benchmark in the global oil market, with its price influenced by supply and demand, geopolitical events, and OPEC actions. Reflecting on last year’s market, we saw WTI remain below $60 amid various geopolitical and trade tensions. Fast forward to today, January 19, 2026, and the situation has changed vastly, with WTI now trading around $82 a barrel. The main drivers of the market have shifted from isolated threats to broader concerns about global supply limits.

Current Market Focus

While we previously monitored US carrier movements toward Iran in 2025, our current attention is on the Red Sea shipping lanes. Recent disruptions forced many oil tankers to reroute around Africa, adding considerable costs and nearly two weeks to travel times. This ongoing uncertainty in a key chokepoint suggests buying near-term call options for potential price spikes is still a smart move. The tariff threats related to Greenland that affected sentiment last year are not our main concern now. Instead, we are analyzing the latest global growth forecasts, which show a slight but steady decline in industrial demand from China and Europe. Traders should view this as a challenge and consider put options to protect long futures positions against possible downturns due to falling demand. The weekly inventory data remains important from our 2025 outlook. The latest report from the Energy Information Administration (EIA) showed a significant crude oil draw of over 9.2 million barrels, far surpassing analyst expectations and indicating strong demand. If this trend continues in the upcoming weeks, it will provide solid support for higher prices. OPEC+ decisions remain a major market driver, just as they were last year. The group’s recent commitment to maintain voluntary production cuts through the end of this quarter shows a clear intent to keep supply limited. We believe this move creates a strong price floor, making strategies that rely on prices sharply dropping particularly risky right now. Create your live VT Markets account and start trading now.

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