Oil prices climb as U.S. winter storm disrupts output, Kazakhstan supply remains low, and OPEC+ policies support crude markets amid geopolitical risks
Oil prices rose on Wednesday amid renewed supply concerns after a severe U.S. winter storm disrupted crude output and exports, while ongoing production shortfalls in Kazakhstan and geopolitical tensions bolstered the market.
Brent crude futures briefly touched their highest levels since late September before easing slightly in early European trading.
By mid-morning, Brent was modestly lower but remained near multi-month highs, with U.S. West Texas Intermediate (WTI) following a similar trend.
Both benchmarks surged roughly three per cent in the previous session as traders weighed tightening supplies against broader macroeconomic factors.
A powerful winter storm over the weekend forced substantial shut-ins in key U.S. oil-producing regions, with crude output losses estimated at up to two million barrels per day, or nearly 15 per cent of national production.
Exports from Gulf Coast ports fell to zero before a partial rebound, highlighting the disruption to logistics and refining operations.
Supply pressures were compounded by slow recovery in Kazakhstan, where the Tengiz oilfield remains below normal output following a fire and power outage.
Analysts expect reduced output to persist into early February, tightening global supply despite the Caspian Pipeline Consortium resuming full capacity at its Black Sea terminal.
Traders are also watching the upcoming February 1 OPEC+ meeting, where delegates are expected to maintain a pause on production increases for March.
The alliance has frozen output hikes through the first quarter to support prices amid soft demand forecasts.
Geopolitical tensions in the Middle East further underpin market sentiment.
A U.S. aircraft carrier strike group has been deployed to the region, raising concerns over potential supply disruptions from major producers.
On the demand side, a Reuters poll indicated that U.S. crude and gasoline stockpiles likely rose in the week to 23 January, while distillate inventories, critical for heating fuel, were expected to decline.
Official government data is due later in the day, with traders closely monitoring signs of emerging deficits or surpluses.
