Oil prices were up on the first trading day of 2026 after registering their biggest annual loss since 2020, as investors weighed oversupply concerns against geopolitical risks, including the war in Ukraine and Venezuela exports.
Brent crude futures ended at $60.75 per barrel after adding 10 cents as the US West Texas Intermediate (WTI) crude futures also grew by 10 cents to $57.32 a barrel.
Russia and Ukraine traded allegations of attacks on civilians on New Year’s Day despite talks overseen by US President Donald Trump, aimed at ending the nearly four-year-old war.
Ukrainian President Volodymyr Zelenskiy wrote that over 200 attack drones were launched onto Ukraine in the night by Russia, saying energy infrastructure in seven regions across Ukraine had been targeted.
Russia accused Ukraine of killing at least 24 people in a drone strike on a hotel and cafe where civilians were seeing in the New Year in a Russian-controlled part of the Kherson region in southern Ukraine.
Ukraine’s military, which has accused Russia of killing many civilians in its own attacks on Ukrainian cities, said it targeted strictly military and energy targets.
Meanwhile, Trump administration ratcheted up pressure on Venezuelan President Nicolas Maduro on Wednesday, imposing sanctions on four companies and associated oil tankers it said were operating in Venezuela’s oil sector.
Despite the threat, Venezuela said it is ready to accept US investment in its oil.
The US-Venezuela tensions have escalated since early December, when President Trump ordered a naval blockade offshore Venezuela to halt sanctioned tankers shipping oil and products to and from the South American country.
President Trump also threatened to aid protesters in Iran if security forces fire on them, days into unrest that has left and posed the biggest internal threat in years to Iranian authorities.
The Organisation of the Petroleum Exporting Countries and allied producers (OPEC+) is due to meet on Sunday. Traders widely expect the group to continue pausing output increases in the first quarter.
In recent days, OPEC’s top producer and de facto leader, Saudi Arabia, and the cartel’s large producer and influential member, the United Arab Emirates (UAE), had a very public rift regarding their backing of opposing sides in Yemen.
In November, the eight OPEC+ producers – Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman – decided to keep production steady over the first quarter of 2026. It also decided to pause production increments in January, February, and March 2026 due to seasonality.