On Tuesday, March WTI crude oil closed down -0.62% and March RBOB gasoline closed down -1.32%. Weak US retail sales in December signal consumer spending weakness, impacting economic growth and energy demand. However, the dollar index fell to a 1-week low, and US-Iran tensions are adding a risk premium to crude prices.

US December retail sales were stagnant, weaker than expected, indicating consumer spending weakness. This could lead to a Q4 GDP downward revision, impacting energy demand and crude prices. Geopolitical tensions in the Middle East, specifically between the US and Iran, are supporting crude prices due to potential disruptions in key shipping lanes.

Venezuela’s increase in crude exports to 800,000 bpd from 498,000 bpd in January is boosting global oil supplies, negatively impacting prices. Russia’s stance on peace talks with Ukraine remaining unresolved is bullish for oil prices due to ongoing restrictions on Russian crude. The EIA raised its 2026 US crude production estimate.

OPEC+ will pause production increases through Q1 of 2026 due to an emerging global oil surplus. Ukrainian attacks on Russian refineries and tankers, coupled with US and EU sanctions on Russian oil companies, have decreased global oil supplies. The consensus is that EIA crude inventories fell last week, while gasoline supplies rose.

Last Wednesday’s EIA report showed US crude oil inventories below the seasonal average, gasoline inventories above, and distillate inventories below. US crude oil production decreased to a 14-month low. Baker Hughes reported a slight increase in active US oil rigs last week.

Read more at Yahoo Finance: Crude Prices Edge Lower on Energy Demand Concerns