RoydadNaft –  Oil prices declined on Wednesday as anticipated increases in U.S. crude inventories offset the impact of a temporary production halt at two major fields in Kazakhstan, while pressure from U.S. threats to impose tariffs over its push to control Greenland also weighed on the market.

According to Roydad Naft report, Brent futures fell 97 cents, or 1.5%, to $63.95 per barrel (as of 07:45 GMT). The U.S. WTI crude contract also dropped 78 cents, or 1.3%, to $59.58 per barrel.

Both contracts had closed nearly $1 per barrel, or 1.5%, higher in the previous session after OPEC+ member Kazakhstan halted production at the Tengiz and Korolev oilfields on Sunday due to power distribution issues. Strong economic data from China was another positive factor.

Production at these two Kazakh fields may remain offline for another 7 to 10 days, according to three industry sources speaking to Reuters.

The halt at Tengiz—one of the world’s largest oil fields—and Korolev is temporary, and downward pressure from expected rises in U.S. crude inventories, along with geopolitical tensions, is likely to persist, according to Tony Sycamore, IG market analyst, on Wednesday.

U.S. President Donald Trump’s pledge to impose new tariffs on European countries if no agreement is reached for U.S. control over Greenland is adding pressure to oil markets, as such tariffs could slow economic growth.

Trump stated on Tuesday that there is “no going back” on his goal to control Greenland.

U.S. crude oil and gasoline inventories are expected to have risen last week, while distillate stocks likely fell, based on a preliminary Reuters poll on Tuesday.

Six analysts surveyed by Reuters estimated on average that crude inventories rose by about 1.7 million barrels in the week ending January 16.

Weekly data from the American Petroleum Institute (API) is scheduled for release at 4:30 p.m. ET (21:30 GMT) on Wednesday, and data from the U.S. Energy Information Administration (EIA), the statistical arm of the Department of Energy, at noon ET (17:00 GMT) on Thursday—both delayed by one day due to a U.S. federal holiday on Monday.

Although this inventory build is negative for oil prices, Gregory Brew, senior analyst at Eurasia Group, noted that the potential escalation of geopolitical tensions could support higher oil prices.