Brent crude hits $64 as oil prices surge on multiple concerns

Brent hit $64 per barrel on Tuesday as oil prices surged over multiple market-related concerns, including risks of Iran-related supply disruptions and uncertainties over the future of supply in Venezuela returning to focus.
In the fresh price surge, the Brent price rose to $64.01 per barrel, up 0.7% from Monday’s close of $63.55. The US benchmark West Texas Intermediate was at $59.83 per barrel, up around 0.8% from the previous close of $59.35.

Reports that the US President Donald Trump has been briefed on options beyond conventional air strikes against Iran, including cyber and psychological operations, amid ongoing protests strengthened geopolitical risk perceptions in the markets

Officials said the potential operations could target Iran’s command structure, communications networks and state-controlled media, but stressed that no final decision has been made and that diplomatic channels remain open.

White House Press Secretary Karoline Leavitt has said Trump’s priority on Iran is diplomacy, while noting that the military option remains on the table.

These developments have raised concerns that escalating tensions in the Middle East, home to a significant share of global oil reserves, could disrupt supply, putting upward pressure on prices.

Trump’s announcement that countries trading with Iran would face a 25% tariff in their trade with the US described as “firm and final” has further increased market uncertainty. Experts warn that such tariffs could heighten the risk of a trade war that may weigh on global growth and reignite inflation.

Meanwhile, Trump said talks with Caracas were “going very well” following the detention of Venezuelan President Nicolas Maduro, adding that the purchase of 50 million barrels of Venezuelan oil is on the agenda and that $4.2 billion worth of oil is already en route to the US.

He also said he was dissatisfied with Exxon’s stance on Venezuelan oil projects and was considering excluding the company from oil tenders in the country. Experts say these remarks are being interpreted by investors as a sign that Venezuela’s investment environment remains unpredictable and commercial uncertainties persist.
This could prompt foreign investors to act more cautiously, limiting medium- and long-term production growth expectations and weakening supply growth prospects.

Concerns over the independence of the US Federal Reserve (Fed) also remain in focus. Former Fed chairs stressed that the central bank’s independence is critical for economic performance, describing the reported “criminal investigation” involving Fed Chair Jerome Powell as an unprecedented attempt to undermine that independence through prosecutorial channels.

While the market impact of the investigation has so far been limited, analysts expect debates over the Fed’s institutional independence to be among the main themes for financial markets this year.

Rising concerns over Fed independence are supporting oil prices in the short term, while medium-term gains are being capped by economic uncertainty and risks to the demand outlook.