(RTTNews) – Crude oil surged on Tuesday as traders assessed the renewed tariff threats by U.S. President Donald Trump against European nations over his increasing interest in acquiring Greenland and the consequent slide in the dollar index.
In addition, the growth forecast from International Monetary Fund supported business sentiments.
WTI Crude Oil for February delivery was last seen trading up by $0.96 (or 1.62%) at $60.40 per barrel.
Trump doubled down on his ambition to seize Greenland, defending his intention by stating that the acquisition will prevent future Russian threat in the region.
Trump threatened Britain, Denmark, Finland, France, Germany, Norway, the Netherlands and Sweden that the U.S. would impose a 10% levy from February 1 if they refuse to support the U.S. and an additional 25% by June 1 if the standoff continues.
The U.S. is the largest export market for the European Union, which comprises 27 nations.
Remarking in a social post that Denmark should “give back” what it owes to the U.S., Trump posted an image depicting Greenland as a part of the U.S. since 2026.
EU leaders, who met and agreed to respond “unflinchingly” to the U.S. threats on Sunday, considered retaliating with a “trade bazooka,” an Anti-Coercion Instrument to shield EU’s interests in times of economic pressure.
Earlier this month, Trump took control of the Venezuelan oil industry by forcefully ousting its President Nicolas Maduro from power. Trump is continuing to persuade oil majors to invest billions in Venezuela to first rebuild the deprecated energy infrastructures so that the U.S. can monetize the rich oil wealth.
Traders are concerned that Trump may replicate the moves in Greenland too.
The U.S. Dollar Index today was last seen trading at 98.51, down by 0.89%.
In its World Economic Outlook for 2026, the IMF has forecast that global GDP would grow 3.30%, up 0.2 percentage points from its previous estimate in October 2025.
The group has estimated growth at 3.20% for 2027, which remains unchanged from the previous prediction.
According to the IMF Chief Economist Pierre-Olivier Gourinchas, global growth is shaking off the trade disruptions and showing resilience amid the tariff war started by Trump in his second term.
Gourinchas stated that businesses adapted by rerouting the supply chains and signing favorable agreements with the Trump administration.
The global lender group also estimated U.S. growth for 2026 at 2.40%, up by 0.3 percentage points from October’s report.
Yesterday’s data from China showed that its economy grew 5.0% last year.
As growth in global economy would consequently increase the demand for crude oil, oil markets reacted positively to these reports.
Iran is now under “virtual” martial law with heavy military and police personnel deployed on the streets with no internet connectivity.
Earlier Trump threatened Iran that the U.S. would intervene to bring peace. However, he retreated, stating that he had reports to believe the “killings have stopped.”
Reportedly, the U.S. is increasing its forces – aircraft carrier in the Strait of Malacca, fighter aircrafts in Jordan, and cargo planes in Diego Garcia military base in the Indian ocean suggesting that the the danger of a U.S.-Iran military confrontation is still looming.
In Europe, the peace proposal scripted by Trump is still to reach the next stage despite several mediations by the U.S. with officials of both the nations. Trump accused Ukraine is not ready for a deal but Ukraine and its European allies blamed Russia of being uninterested in a peace plan.
Reports indicate that after shutting down on Sunday, oil production at Kazakhstan’s Tengiz oilfield could be halted for another 7-10 days, cutting crude exports via the Caspian Pipeline Consortium.
Last week, in its first projection for 2027, the OPEC group stated that oil demand for 2027 would rise by 1.34 million barrels per day as it gauged for 2026 (at 1.38 million bpd) due to estimated fair balance in supply and demand.
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