Oil prices continued to climb during Asian trading on Tuesday, posting a fourth straight day of gains as investors priced in rising risks of supply disruptions from Iran amid escalating political unrest.
By 21:18 ET (02:18 GMT), Brent crude futures for March delivery were up 0.4% at $64.10 a barrel, while U.S. West Texas Intermediate (WTI) crude futures also advanced 0.4% to $59.70 a barrel. In the prior session, Brent touched a more than seven-week high, and WTI rose to its strongest level in about a month.
Iran unrest adds risk premium to prices
Iran, a major producer within OPEC, is experiencing its most significant wave of anti-government protests in years. Reports of widespread violence and heavy casualties as security forces crack down on demonstrators have heightened fears of instability and potential supply disruptions.
U.S. President Donald Trump has warned that military action could follow if Iranian authorities continue to use lethal force against protesters. He has also announced plans to impose a 25% tariff on any country “doing business” with Iran, in an effort to further isolate Tehran economically.
“China is a key buyer of Iranian oil. Whether this secondary tariff threat is sufficient to push China away from Iranian oil remains to be seen,” ING analysts said in a research note.
According to Reuters, Trump is expected to meet senior advisers on Tuesday to discuss potential policy options regarding Iran.
Russian export routes also under strain
Supply concerns are not confined to the Middle East. Russia’s oil export infrastructure remains under pressure amid the ongoing conflict in Ukraine, with Ukrainian forces targeting oil facilities and export hubs.
Among the sites hit is the Caspian Pipeline Consortium (CPC) terminal near Novorossiysk, a key route for Kazakh crude exports. Bloomberg reports that shipments from the CPC terminal this month are expected to total between 800,000 and 900,000 barrels per day—around 45% below initial expectations—placing additional strain on regional supply.
Venezuela moves toward export restart
In contrast, another OPEC producer, Venezuela, is preparing to re-enter global oil markets after a period of disruption. Following political developments in the country and the capture of President Nicolas Maduro, Trump said last week that Caracas would transfer up to 50 million barrels of oil to the United States.
If realised, this move could eventually bring additional supply back into the global market, potentially offsetting some of the current geopolitical supply risks.