Unclarity hits ANS

Prices swirl downward in a sea of murky outcomes from possible tariffs

Steve Sutherlin

Petroleum News

Alaska North Slope crude drifted 38 cents lower Jan. 22 to close at $76.79 per barrel, extending a slide sparked by uncertainty about tariffs and sanctions which may be imposed by the Trump administration, and how they might affect the global economy and crude demand. West Texas Intermediate fell 45 cents to close at $75.44 and Brent fell 29 cents to close at $79.00.

The losing streak over four trading days began the day after ANS surged to a 2025 high of $80.42 Jan. 15 on dovish U.S. inflation news. ANS suffered a loss of $3.63 over the week ending Wednesday Jan. 22.

U.S. President Donald Trump said in a Truth Social post Jan. 22 that he would add tariffs to threatened sanctions on Russia if there is no deal to end its war in Ukraine, adding that the pain could extend to "other participating countries."

Trump has jawboned European Union tariffs, 25% tariffs against Canada and Mexico and a 10% duty on China over the wave of Chinese fentanyl hitting U.S. shores.

The weekly petroleum report from the U.S. Energy Information Administration was delayed by a day due to the Martin Luther King holiday on Jan. 20.

An analyst poll Reuters poll predicted that on average U.S. commercial crude oil reserves -- not including Strategic Petroleum Reserve supplies -- had fallen by 1.6 million barrels in the week ending Jan. 17.

Motor gasoline reserves were estimated to have risen by 2.3 million barrels for the period and distillate inventories were expected to have risen by 300,000 barrels.

ANS dropped $1.57 Jan. 21 to close at $77.17, while WTI plunged $1.99 to close at $75.89 and Brent dropped $1.50 to close at $79.29.

On Jan. 17, ANS shed 52 cents to close at $78.74, WTI fell 80 cents to close at $77.88 and Brent shed 50 cents to close at $80.79.

ANS dropped $1.17 Jan. 16 to close at $79.25, as WTI dropped $1.36 to close at $78.68 and Brent shed 74 cents to close at $81.29.

On Jan. 22, ANS traded at a $1.35 premium over WTI and at a $2.21 discount to Brent.

Futures prices were slightly lower in early Jan. 23 trading in Asian markets as Petroleum News went to press.

Administration orders Alaska oil and gas development

The order calls for immediate removal of regulatory roadblocks to energy and resource projects on federal and state lands.

The order contained a spate of provisions designed to expedite exploration and development in the Arctic National Wildlife Refuge.

"Unleashing this opportunity, however, requires an immediate end to the assault on Alaska's sovereignty and its ability to responsibly develop these resources for the benefit of the Nation," the White House said.

The moves "will allow more crude to flow into the market, which is suffering from a supply glut," said Samer Hasn, XS.com senior market analyst, MarketWatch reported Jan. 21. The move may push energy prices further down, which is "what Trump aspires to do in order to serve his agenda of reducing inflation."

Analysts don't expect the order to substantially boost crude supplies in the short term. Many of the measures do not necessarily change the rules on the books right away -- instead directing federal agencies to begin the lengthy process of undoing Biden policies that also took years to complete, according to analysis in The Hill Jan. 20.

Hastening the refill of the SPR, however, could give prices a quick boost.

"In the short run, the impact from replenishing the strategic reserves could outweigh (because doing that would withdraw oil from market quickly), while increasing production takes time," Ipek Ozkardeskaya, Swissquote Bank senior analyst said in a note. "But because Trump wants energy to be cheap, he would be advised to act slowly -- which could have a limited impact on oil prices."