Crude oil prices found a tentative floor today, Tuesday, 20 January 2026, as traders paused to evaluate the geopolitical implications of a sudden and unusual trade dispute: U.S. threats to impose tariffs on Denmark and the EU over the status of Greenland.
While the oil market is typically sensitive to Middle Eastern tensions, this “Arctic friction” has introduced a new layer of uncertainty regarding Trans-Atlantic trade relations and energy security in the North.
After a volatile start to the week, the major benchmarks remained largely unchanged during the midday session.
Brent Crude: Trading at $76.45 per barrel (up 0.07%).
West Texas Intermediate (WTI): Trading at $71.95 per barrel (up 0.05%).
The “Greenland risk premium” entered the market following reports that the Trump administration has renewed its interest in the strategic island. The current friction stems from:
Renewed Purchase Interest: A revived proposal for the U.S. to “acquire” or increase administrative control over Greenland for its mineral wealth and Arctic strategic value.
The Tariff Threat: Following a swift rejection from Copenhagen, Washington hinted at “significant trade penalties” on Danish exports and potentially broader EU goods if a deal for “resource cooperation” is not reached.
Arctic Resources: Greenland is believed to hold massive untapped reserves of rare earth minerals and potential offshore oil and gas, making it a focal point for future energy independence.
Jens Nielsen, Senior Energy Strategist at Nordic Markets:
“The market isn’t quite sure how to price this yet. On one hand, it’s a diplomatic spat between allies. On the other, if the U.S. actually pulls the trigger on Danish tariffs, it signals a complete breakdown in Western trade cohesion. For oil, that means lower demand forecasts due to the economic drag of a trade war.”
Meanwhile, supply remains steady. OPEC+ has not signaled any change in production despite the noise from Washington. Investors are also keeping a close eye on U.S. domestic production, which remains at record highs, acting as a natural cap on any major price rallies sparked by the Greenland news.
