Oil prices barely moved on Tuesday, caught between fears of conflict and forecasts of too much supply.
Brent crude rose just 6 cents to $62.13 a barrel by press time, and West Texas Intermediate (WTI) ticked up 2 cents to $58.03, right after a 2% surge on Monday, when Brent posted its biggest daily jump in two months, and WTI hit its strongest single-day rally since November 14.
Traders are stuck between chaos on the seas and barrels stacking up. Ukrainian attacks on Russian vessels and piers have rattled markets, raising the risk of disruptions.
But at the same time, analysts at Barclays on Tuesday warned of too much supply heading into early 2026, even though they admit the glut might ease to around 700,000 barrels per day by the fourth quarter if disruptions continue.
Trump confirms seized Venezuelan oil will stay in U.S. hands
President Donald Trump on Monday confirmed that the U.S. will hold onto the crude oil and ships it seized off the coast of Venezuela. “We’re going to keep it,” Trump said in Palm Beach, right after launching a new class of battleships named after himself.
He didn’t stop there. “Maybe we’ll sell it, maybe we’ll keep it, maybe we’ll use it in the strategic reserve,” Trump said, adding, “We’re keeping the ships also.” That’s the new line in Washington’s blockade of sanctioned oil tankers going in and out of Venezuela. He’s putting more pressure on President Nicolas Maduro and using oil as leverage.
According to Kpler, the U.S. seized a massive tanker on December 10 hauling over 1 million barrels of Venezuelan crude. A second ship was intercepted last weekend. Trump confirmed a third vessel is now being pursued. “It’s moving along. We’ll end up getting it,” he said. “It came from the wrong location. It came out of Venezuela, and it was sanctioned.”
Venezuela, which has the largest proven oil reserves on the planet and helped found OPEC, is still exporting roughly 749,000 barrels a day, Kpler said. Over half of that oil is headed to China.
Gasoline prices drop ahead of record holiday travel
Meanwhile, the price at the pump keeps dropping in the U.S. The average cost of unleaded gas has stayed under $3 per gallon for most of December, the lowest since 2021, according to AAA. The group said this December could be the cheapest since 2020, back when the pandemic brought demand to a halt.
Fuel costs have dropped about 7% since last month and 43% from the mid-2022 high when prices were near $5 a gallon after inflation took off.
That’s good news for drivers, and there’s a lot of them. AAA expects a record-breaking 122 million Americans to travel at least 50 miles between December 20 and January 1. Out of that, 110 million will drive.
Lower gas prices could make a dent in holiday inflation, even if it’s not enough to make everyone cheerful.
A CNBC All-America Economic Survey found that over 40% of Americans plan to spend less this holiday season, a six-point rise from last year. Among those cutting back, 46% blamed high prices for food and goods.
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