Oil prices climbed more than 2% on Tuesday, buoyed by supply disruptions caused by extreme winter weather across the United States, which raised concerns about tighter crude availability.
By 12:15 ET (17:15 GMT), Brent crude futures for March delivery were up 2% at $66.08 a barrel, while U.S. West Texas Intermediate crude rose 2.3% to $62 a barrel.
U.S. winter storm disrupts oil supply
A powerful snowstorm sweeping across large parts of the U.S. has forced production shutdowns and strained the nation’s power grid. The severe weather has heightened fears that prolonged disruptions could significantly tighten oil supplies and push prices higher.
Industry estimates indicate that U.S. producers may have lost as much as 2 million barrels per day over the weekend, representing roughly 15% of total national output. In addition, several refineries along the U.S. Gulf Coast reported operational problems linked to freezing temperatures, raising concerns about fuel supply constraints.
Analysts at ING noted that the winter storm is also likely to boost demand for heating fuels. They said freezing conditions have disrupted oil production and refinery operations, leading to lower refinery run rates in recent days.
Iran-related supply concerns ease
Oil prices had already gained ground in recent sessions amid heightened geopolitical tensions involving Iran, which fueled speculation about potential supply disruptions. Over the weekend, a U.S. aircraft carrier and several destroyers were deployed to the Middle East, and U.S. President Donald Trump said an “armada” was heading toward Iran, though he expressed hope it would not be needed.
The military deployment followed Trump’s warnings to Iran over its handling of nationwide protests. However, demonstrations in the country have eased in recent weeks, and the U.S. president has since softened his rhetoric, helping to calm market fears.
Kazakhstan plans output restart
Expectations of tighter global supply were partly offset by signals from Kazakhstan that it plans to resume production at the Tengiz oil field, its largest facility, after operations were halted by a fire and power outage. Reuters reported that initial output levels are likely to be modest, particularly as the country has yet to lift a force majeure on CPC Blend exports.
Kazakhstan ranks as the world’s 12th-largest oil producer and is a member of the OPEC+ group. The alliance is expected to keep production levels unchanged at its upcoming February 1 meeting. OPEC+ had steadily increased output through 2025 before announcing a pause later in the year to counter prolonged weakness in oil prices.
