Oil prices closed higher on Tuesday (December 24th) as investors assessed stronger-than-expected US economic growth and the risk of oil supply disruptions from Venezuela and Russia.

Brent crude futures closed up 31 cents, or 0.5%, at $62.38 a barrel. U.S. West Texas Intermediate (WTI) crude futures rose 37 cents, or 0.64%, to $58.38.

Prices had risen more than 2% on Monday, with Brent posting its biggest daily gain in two months and WTI rising the most since November 14th.

The U.S. economy grew faster than expected, driven by strong consumer spending, the Commerce Department's Bureau of Economic Analysis said in its preliminary estimate of third-quarter GDP on Tuesday.

"The market is trying to decide whether we should be more excited about the demand stemming from strong growth or concerned that the Fed will have to rein in that growth to control inflation," said Phil Flynn, senior analyst at Price Futures Group.

Other data paint a mixed picture for the economy. US consumer confidence deteriorated in December amid growing concerns about jobs and incomes, while factory production remained unchanged in November after declining in October, data showed on Tuesday.

Investors are also weighing the risk of Venezuelan supply disruptions. US President Donald Trump earlier this month announced a blockade of all sanctioned oil tankers entering and leaving Venezuela, raising concerns among shipowners.

"With Venezuela's dwindling storage capacity, there is a growing risk that the country may have to halt some production," said UBS analyst Giovanni Staunovo.

Tanker loading in Venezuela has slowed, with most vessels only transporting oil cargoes between domestic ports after US action against more vessels. Disruptions to Russian oil supplies have also supported prices.

Russian forces attacked Ukraine's Black Sea port of Odesa on Monday night, damaging port facilities and a ship, the second attack in the region in less than 24 hours. Ukrainian drone strikes damaged two ships, two docks, and started a fire in a village in Russia's Krasnodar region.

Ukraine is also targeting Russian maritime logistics, focusing on oil tankers operating in a shadow fleet attempting to evade sanctions against Russia.

The oil market is expected to remain well supplied in the first half of 2026, Barclays said in a note this week. However, the bank added that the oil surplus would shrink to just 700,000 barrels per day by the fourth quarter of 2026 and that prolonged disruptions could further tighten the market. (alg)

Source: Reuters.com