Oil prices edged lower on Thursday as uncertainty over Arctic geopolitics, renewed concerns about the independence of the US Federal Reserve (Fed), and signs that global supply continues to outpace demand weighed on market sentiment.
International benchmark Brent crude traded at $64.58 per barrel at 9.34 a.m. local time (0634 GMT), down around 0.2% from the previous close of $64.70.
US benchmark West Texas Intermediate (WTI) was at $60.55 per barrel, down about 0.1% compared with $60.62 in the prior session.
US President Trump said Wednesday that a framework for a deal involving Greenland and the broader Arctic region was established following his meeting with NATO Secretary General Mark Rutte in Davos, Switzerland.
"This solution, if consummated, will be a great one for the United States of America, and all NATO Nations," Trump wrote on his Truth Social platform.
"Based upon this understanding, I will not be imposing the Tariffs that were scheduled to go into effect on February 1st," he added.
Trump said additional discussions are being held concerning the "Golden Dome" -- a proposed US missile defense system -- as it pertains to Greenland.
Last week, Trump said Washington would impose 10% tariffs on goods from Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands and Finland starting on Feb. 1, rising to 25% in June unless there is a deal for "the complete and total purchase of Greenland."
Signals pointing to easing trade tensions and the pullback of tariff threats initially supported oil prices by reducing fears over global trade frictions. However, lingering geopolitical uncertainties in the Arctic region kept gains in check.
Markets also digested Trump's remarks on the Fed. He said Wednesday that he was nearing the end of a search to replace Fed Chair Jerome Powell and hinted that he has largely settled on a candidate.
"I'd say we're down to three, but we're down to two. And I probably can tell you, we're down to maybe one, in my mind," he told CNBC in Davos.
Earlier in the day, Trump said he plans to soon announce the new chair of the Fed as he continued to criticize Powell in his speech at the World Economic Forum in Davos.
Trump's continued criticism of Powell has led investors to price in the possibility of a more growth-oriented, low-interest-rate-friendly leadership at the Fed. That expectation has weighed on the dollar, offering some support to oil prices.
Still, rising concerns about the Fed's independence and medium-term economic uncertainty have limited the upward momentum.
On the fundamentals side, the International Energy Agency slightly raised its global oil demand growth forecast. The agency revised up its outlook by 69,000 barrels per day (bpd), projecting that global oil demand will rise by about 932,000 bpd in 2026 to 104.98 million bpd, according to its January Oil Market Report.
Global oil supply, meanwhile, fell by 350,000 bpd in December to 107.41 million bpd, marking a third consecutive monthly decline and leaving output about 1.6 million bpd below the record high reached in September 2025.
While stronger demand expectations and falling supply point to a tighter global oil balance, analysts say supply levels still exceeding demand have continued to cap price gains in the near term.
By Handan Kazanci
Anadolu Agency
energy@aa.com.tr