Oil prices swung between gains and losses on Jan. 19 as the standoff between the U.S. and Europe over Greenland intensified.
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The price of Brent crude oil, the international standard, and West Texas Intermediate (WTI) crude oil, the U.S. benchmark, each fell about 0.5% in early trading before turning positive at midday. At noon hour, Brent was up 0.10% and trading at $64.21 per barrel. WTI oil was up 0.32% and trading at $59.63 a barrel.
The volatility comes after U.S. President Donald Trump threatened increased tariffs on eight European countries until he is allowed to buy Greenland, which is a territory of Denmark. Analysts say that oil prices are fluctuating as the standoff over Greenland raises the prospect of a transatlantic trade war.
The Situation in Iran
Trump is threatening to impose an additional 10% tariff on Feb. 1, rising to 25% in June, if no agreement on Greenland is reached. The eight countries targeted by Trump for more tariffs include Denmark, Norway, Sweden, France, Germany, the United Kingdom (U.K.), the Netherlands, and Finland. The European Union is reportedly weighing an economic response to Trump’s latest threat.
Beyond Europe, oil prices are also being impacted as supply risks in Iran ease. Crude prices had risen over the past week on worries that civil unrest in Iran and a potential U.S. strike on that country could disrupt oil supplies from the Middle East, which accounts for a major share of the global supply. However, that rally faded after Trump said there would be no U.S. military intervention in Iran.
The volatility in oil prices continues to impact the stocks of leading energy companies such as Chevron (CVX), Occidental Petroleum (OXY), and ExxonMobil (XOM).
Is CVX Stock a Buy?
The stock of Chevron has a consensus Strong Buy rating among 17 Wall Street analysts. That rating is based on 14 Buy and three Hold recommendations issued in the last three months. The average CVX price target of $177.53 implies 19.27% upside from current levels.
