March WTI Crude Oil (CLH26) closed up +0.82 (+1.31%) on Wednesday and March RBOB Gasoline (RBH26) closed up +0.0215 (+1.14%).
Crude oil and gasoline prices stabilized sharply higher on Wednesday, with crude oil climbing to a 4-month high and gasoline to a 2-month high. Crude prices jumped Wednesday after President Trump threatened to launch a new attack on Iran unless it negotiates a nuclear deal. Crude prices also found support from the EIA’s weekly report released Wednesday, which showed crude inventories fell unexpectedly and gasoline supplies rose less than expected. The strength of the dollar on Wednesday limited the rise in crude oil.
Crude oil prices jumped Wednesday after President Trump said in a social media post that he wants Iran to come to the table and negotiate a “fair and equitable deal without nuclear weapons.” He warned Iran that time is running out to reach a deal with the United States, stressing that a fleet of American warships entering the region is ready to carry out its mission “with speed and violence.” A US attack on Iran could disrupt oil supplies to OPEC’s fourth-largest producer.
Crude oil is also receiving support after Russia dampened hopes of a breakthrough in peace talks with Ukraine, after the Kremlin said the “territorial issue” remained unresolved with Ukraine and that there was “no hope of reaching a long-term settlement” to the war until Russia’s demand for territory in Ukraine was accepted. Prospects for continued war between Russia and Ukraine will maintain restrictions on Russian crude and are bullish on oil prices.
The IEA last Wednesday lowered its estimate of the global gross surplus for 2026 to 3.7 million bpd, compared to 3.815 million bpd last month. On January 13, the EIA raised its estimate for 2026 U.S. crude production to 13.59 million bpd from 13.53 million bpd last month, and reduced its estimate for 2026 U.S. energy consumption to 95.37 (quadrillion btu) from 95.68 last month.
Vortexa reported Monday that crude oil stored on stationary tankers for at least 7 days fell -0.6% w/w to 113.30 million barrels in the week ended January 23.
Crude gained support after OPEC+ announced on January 3 that it would stick to its plan to suspend production increases in the first quarter of 2026. OPEC+, at its November 2025 meeting, announced that its members would increase production by +137,000 b/d in December, but would then suspend production increases in the first quarter of 2026 due to the global oil surplus emerging. OPEC+ is trying to restore all of the reduced production of 2.2 million b/d it achieved in early 2024, but it still has 1.2 million b/d of production left to restore. OPEC+ will meet this weekend to review a decision on production policy and is expected to stick to plans to keep oil production stable. OPEC crude production in December increased by +40,000 b/d to 29.03 million b/d.
