Oil prices rebound to $64.62 as Trump renews threats against Iran

Vijay Valecha, January 23, 2026, Middle East Economy

Oil prices are on track to post weekly gains of around 0.6 percent, after prices rose earlier in the week on Trump’s threats to invade Greenland

Oil prices bounced back on Friday after U.S. President Donald Trump reiterated threats toward Iran, a key Middle Eastern oil producer, raising fears that potential military action could disrupt global supplies.

As of 5:07 GMT, Brent crude climbed 56 cents, or 0.87 percent, to $64.62 a barrel, while U.S. West Texas Intermediate gained 53 cents, or 0.89 percent, to $59.89 a barrel.

Trump renews Mideast threats

Oil prices fell roughly 2 percent on Thursday before recovering after Trump told reporters aboard Air Force One that the United States had an armada warship heading toward Iran, though he said he hoped it would not be used. He also renewed warnings to Tehran over the killing of protesters and any move to restart its nuclear program.

A U.S. official said warships, including an aircraft carrier and guided missile destroyers, are expected to arrive in the Middle East in the coming days. Notably, Iran is OPEC’s fourth-largest oil producer and a key supplier to China, the world’s second-biggest oil consumer.

“In the Middle East, risk premium remains intact. Donald Trump has not ruled out intervention if Iran resumes its nuclear program, keeping geopolitical uncertainty elevated,” said Vijay Valecha, Chief Investment Officer, Century Financial.

Oil prices on track for 0.6 percent weekly gain

Oil prices are on track to post weekly gains of around 0.6 percent, after prices rose earlier in the week on Trump’s threats to invade Greenland, a move that risked unsettling the transatlantic alliance, before sliding on Thursday when he walked back the prospect of military action.

Trump later softened his stance, saying Denmark, which governs the Arctic island, along with NATO and the United States, had reached an agreement granting “total access” to Greenland.

“On the fundamental side, crude is being supported by supply disruptions in Kazakhstan. Output at the Tengiz and Karachaganak fields was halted after a fire damaged power generators. Production is expected to remain offline for 7-10 days, tightening near-term supply. In addition, the Caspian Pipeline Consortium (CPC), which handles around 80 percent of Kazakhstan’s oil exports, has been disrupted by Ukrainian drone attacks,” Valecha added.

U.S. stockpiles rise as fuel demand slows

Oil prices also eased on Thursday after bearish government data showed U.S. stockpiles rose last week as fuel demand slowed in the world’s largest oil-consuming nation. Figures from the U.S. Energy Information Administration released on Thursday showed crude inventories increased by 3.6 million barrels in the week to January 16, well above the 1.1 million-barrel rise forecast by analysts.

The build also surpassed the 3 million barrels that market sources said the American Petroleum Institute reported a day earlier. Both sets of data were published a day later than usual due to the U.S. Martin Luther King Jr. holiday on Monday.

Source

Middle East Economy