Oil prices declined on Tuesday as traders focused on the potential restart of crude supplies from Kazakhstan. However, losses were capped after a powerful winter storm disrupted oil production and refinery operations across the U.S. Gulf Coast.
Brent crude futures slipped by 41 cents, or 0.6%, to trade at $65.18 per barrel by 0740 GMT. U.S. West Texas Intermediate crude also edged lower, falling 30 cents, or 0.5%, to $60.33 per barrel.
Kazakhstan is preparing to resume output at its largest oil field, according to the country’s energy ministry. Despite this, industry sources noted that production volumes remain limited for now.
The Caspian Pipeline Consortium, which manages Kazakhstan’s primary oil export route, said it has restored full loading capacity at its terminal on Russia’s Black Sea coast. The move follows the completion of maintenance work at one of the terminal’s three mooring points.
ING commodity strategists said a recovery in exports should improve short-term supply availability, potentially easing pressure on the Brent prompt spread, which has strengthened sharply throughout January. They added that the strong timespreads appear inconsistent with forecasts pointing to a sizable global oil surplus.
The premium of March Brent contracts over April has now climbed above 80 cents per barrel, compared with roughly 30 cents at the beginning of the month.
Downward pressure on oil prices was softened by supply disruptions in the United States, where extreme winter weather significantly impacted energy infrastructure. Analysts estimate that U.S. producers shut in as much as 2 million barrels per day over the weekend, representing around 15% of total national output.
Several refineries along the Gulf Coast also reported operational issues caused by freezing conditions. ANZ analyst Daniel Hynes warned that these disruptions have raised concerns about potential fuel supply shortages.
Geopolitical tensions added another layer of uncertainty. Two U.S. officials confirmed that a U.S. aircraft carrier and accompanying warships have arrived in the Middle East, expanding President Donald Trump’s ability to protect U.S. forces or potentially respond to escalating tensions with Iran.
Hynes noted that supply risks remain present, emphasizing that Middle East tensions persist following the deployment of U.S. naval assets to the region.
Looking ahead, eight members of the OPEC+ alliance are expected to maintain their pause on planned oil output increases for March. According to three delegates, the decision will be discussed at a meeting scheduled for February 1.
The countries involved include Saudi Arabia, Russia, the United Arab Emirates, Kazakhstan, Kuwait, Iraq, Algeria, and Oman.
