Geopolitics hike ANS

Iran focal point as violent crackdown on protests draws US attention

Steve Sutherlin

Petroleum News

Alaska North Slope crude jumped $1.35 Jan. 13 to close at $65.56 per barrel as President Trump halted talks with Iran's government officials and encouraged protesters against the regime in the country while hinting at a military strike if the government continued to kill demonstrators. West Texas Intermediate vaulted $1.65 to close at $61.15, and Brent vaulted $1.60 to close at $65.47.

Oil futures continued upward as the U.S. military ordered precautionary evacuation of some personnel from Al Udeid Air Base in Qatar Jan. 14 -- defying a jump in U.S. inventories, taking WTI to a close of $62.02 and taking Brent to $66.52. The benchmarks then fell in Jan. 15 Asian trade after Trump said the killing of protesters was ending.

The U.S. Energy Information Administration released data Jan. 14 indicating commercial crude oil inventories were up 3.4 million barrels from the previous week to 422.4 million barrels -- 3% below the five-year average for the time of year.

Total motor gasoline inventories surged 9.0 million barrels over the week to 251.0 million barrels -- 4% above the five-year average for the time of year, the EIA said, adding that distillate fuel inventories "slightly decreased."

Crude prices had already been on the rise as traders digested the reality that massive investment would be needed to restore production from Venezuela, easing fears that renewed flow from the country would swiftly create a glut of oil on the world market.

ANS rose 63 cents Jan. 12 to close at $64.21, as WTI rose 38 cents to close at $59.50 and Brent rose 53 cents to close at $63.87.

ANS added 81 cents Jan. 9 to close at $63.58, WTI leapt $1.73 to close at $59.12 and Brent leapt $1.75 to close at $63.34.

On Jan. 8 ANS surged $2.00 to close at $63.58, WTI jumped $1.40 to close at $57.39 and Brent leapt $1.63 to close at $61.59.

Prices fell Jan. 7, taking ANS 70 cents lower to close at $60.87, while WTI plunged $1.14 to close at $55.99 and Brent fell 74 cents to close at $59.96.

ANS leapt $3.99 over the trading week from its close of $61.57 Jan. 6 to its $65.56 close on Jan. 13.

Iran tension 2026

Iran has the world's third-largest proven crude reserves and was the ninth-ranked oil producer in the world in 2023, producing some 4 million barrels per day, according to EIA data.

In a conflict, "disruption can jump from manageable to systemic" because the potential hit of a loss in Iranian exports could ignite "second-round effects -- higher war-risk insurance, fewer available tankers, rerouting and delays and higher freight costs," Rich Tabaka, president of Allied Resource Partners told MarketWatch.

"Those frictions can reduce effective supply far more than the headline barrel loss," he said.

Producers in the Organization of the Petroleum Exporting Countries have "spare" production capacity on paper, but "a lot of it is in the same region," Tabaka said. "If regional logistics and shipping lanes are impaired, that spare capacity becomes harder to deliver quickly and it doesn't function like a clean backstop when the bottleneck is transport, not production."

"Iran matters to the oil market more for fear than barrels," said Jay Young, founder and CEO of King Operating. "Prices move on risk before they move on reality" -- so when tensions rise in the Middle East, the "market adds a premium even if supply has not changed yet."

On June 13, 2025, Israel launched airstrikes against Iranian military and nuclear infrastructure, and Iran retaliated, Yahoo News reported. The Strait of Hormuz was never closed, but Brent jumped some 7%, from $69 to $74 per barrel, in a day.

"In a situation of widespread upheaval, it's very likely that skilled workers are unable to actually get to (production and export facilities), and when they get there, do they have basic things like electric power?" said Clay Seigle, a senior fellow at the Center for Strategic and International Studies.