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Oil markets rise on tightened sanctions and cold weather demandSupply pressures intensified following reports from Russia indicating that its oil production in December fell below its OPEC+ output target. The decline was attributed to a sharp reduction in seaborne exports, which reached their lowest levels since August 2023. |
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The global oil market advanced on Tuesday, January 7, 2025, driven by mounting supply concerns stemming from stricter Western sanctions on Iran and Russia. Colder-than-expected weather conditions in the United States and Europe further boosted heating oil demand, adding upward momentum to prices.
Brent crude increased by 75 cents and closed at $77.05/barrel.
WTI rose by 69 cents and finished at $74.25/barrel.
Supply pressures intensified following reports from Russia indicating that its oil production in December fell below its OPEC+ output target. The decline was attributed to a sharp reduction in seaborne exports, which reached their lowest levels since August 2023. Amplifying concerns, Chinese ports in Shandong—China’s largest destination for Iranian crude—implemented bans on blacklisted vessels under U.S. sanctions, further constraining supply flows.
In addition to sanctions, the oil market found support from freezing weather conditions across the U.S. and Europe, which drove increased demand for heating fuels. These conditions also heightened the risk of production disruptions, as freeze-offs in key oil-producing regions threatened to curtail output.
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Written by: Muhammad Hafiz
