Oil futures: Crude edges up from two-week lows, Libya protests eyed

Quantum Commodity Intelligence - Crude oil futures Tuesday were marginally higher as markets looked to have found some support following more than a week of gradual declines. 

Front-month Mar25 ICE Brent futures were trading at $77.25/b (1720 GMT) versus Monday's settle of $77.08/b, while the more-liquid Apr25 contract was at $76.30/b.

At the same time Mar25 NYMEX WTI was trading at $73.35/b, versus Monday's close of $73.17/b.

Benchmarks recovered from lows after protests shut two of Libya's main oil ports Tuesday, blocking up to 400,000 bpd or a third of the country's exports, coming on top of a restricted physical market due to sanctions against Russia.

Prices initially came under pressure at the start of the week after the Trump administration made it clear that tariffs would be part of its economic leverage following a row with Colombia over migrant deportations and broader plans on metals.

"Tariff headlines will also not be helping sentiment, with reports that President Trump will place tariffs on steel, aluminium and copper imports," said Warren Patterson, head of ING's commodity research. Reports also suggest that Treasury Secretary Scott Bessent is pushing for a universal import tariff of 2.5%, which would be raised gradually.

Analysts have flagged concerns that a wider trade war will weigh heavily on global trade, dampening oil-demand growth, although early indications suggest President Trump has softened rhetoric against China.

Physical markets also remain relatively tight, particularly in Asia, where refiners are most exposed to the clampdown on Russian shipping, in turn blowing out Dubai spreads. 

"It is a sign that the sanctions towards Russia are making the medium sour crude market very tight. Brent crude is unlikely to fall much lower as long as these sanctions are in place," said Bjarne Schieldrop, Chief commodities analyst at SEB.

China

Oil prices also wobbled early in the week amid interest in China's DeepSeek's low-cost AI model, which could impact energy demand used to power data centres over the long term.

Meanwhile, China's factory activity fell back into contraction territory in January ahead of the early Lunar New Year holiday period, easing following a rush of purchase orders prior to Donald Trump's inauguration.

The latest data showed that the official manufacturing purchasing managers' index (PMI) dropped to 49.1 in January, down from 50.1 a month earlier.

Asian energy markets closed early on Tuesday and will be shut for the next two days due to the Chinese New Year holiday.