Oil Prices Surge as U.S. Shutdown Nears End, Igniting Global Market Optimism

Optimism over an end to the historic U.S. shutdown lifts market confidence and fuels a rebound in global oil prices.

Oil prices climbed on Monday, driven by growing optimism that the U.S. government shutdown, now stretching into its 40th day could soon come to an end. Investors cheered signs of progress in Washington, anticipating that a reopening would boost demand in the world’s largest oil-consuming nation.

Brent crude rose by 47 cents, or 0.74%, to $64.10 a barrel, while U.S. West Texas Intermediate (WTI) gained 50 cents, or 0.84%, to trade at $60.25. The upward momentum came as the U.S. Senate moved closer to voting on measures to restart the federal government and restore pay to nearly 800,000 workers.

“The imminent reopening is a welcome boost, restoring pay to federal employees and lifting consumer confidence,” said Tony Sycamore, market analyst at IG Markets. “This should improve risk sentiment across markets and could drive WTI prices toward $62 a barrel.”

Last week, both Brent and WTI slipped around 2%, marking their second straight weekly loss amid concerns of global oversupply. While OPEC and its allies slightly increased production in December, the group has paused further hikes for the first quarter to avoid flooding the market.

Meanwhile, rising U.S. crude inventories and growing oil storage in Asian waters continue to signal abundant supply. Tensions around Russian oil, including looming U.S. sanctions on Lukoil and a failed deal with Swiss trader Gunvor, have added another layer of uncertainty.

Despite these challenges, the renewed hope for economic stability in the U.S. has injected a sense of optimism back into the global oil market, hinting at steadier days ahead for the energy sector.