Oil prices settled lower on Friday on the first trading day of 2026 after registering their biggest annual loss since 2020, as investors weighed oversupply concerns against geopolitical risks, including the war in Ukraine and Venezuela exports.

Brent crude futures closed down 10 cents to $60.75 a barrel, while U.S. West Texas Intermediate crude eased 10 cents to $57.32.

Russia and Ukraine traded allegations of attacks on civilians on New Year’s Day despite talks overseen by U.S. President Donald Trump, aimed at ending the nearly four-year-old war. Kyiv has been intensifying strikes against Russian energy infrastructure, aiming to cut off Moscow’s sources of financing for its military campaign.

The Trump administration ratcheted up pressure on Venezuelan President Nicolas Maduro on Wednesday, imposing sanctions on four companies and associated oil tankers it said were operating in Venezuela’s oil sector. Maduro said in a New Year’s interview that his country is willing to receive U.S. investment in its oil sector, coordinate in the fight against drug trafficking and hold serious talks with the United States.

Trump also threatened to aid protesters in Iran if security forces fire on them, days into unrest that has left several dead and posed the biggest internal threat in years to Iranian authorities.

“Despite all these geopolitical concerns, the oil market seems unmoved. Oil prices are locked in this long-term trading range, and there’s a sense that the market is going to be well supplied no matter what happens,” said Phil Flynn, senior analyst with the Price Futures Group.

In the Middle East, a crisis between OPEC producers Saudi Arabia and the United Arab Emirates over Yemen has deepened after flights were halted at Aden’s airport on Thursday.

OPEC+, the Organization of the Petroleum Exporting Countries and allied producers, is due to meet on Sunday. Traders widely expect the group to continue pausing output increases in the first quarter, said Sparta Commodities analyst June Goh.

“2026 will be an important year on assessing OPEC+ decisions for balancing supply,” she said, adding that China would continue to build crude stockpiles in the first half, providing a floor for oil prices.

The Brent and WTI benchmarks each lost nearly 20% in 2025, the steepest since 2020. It was the third straight year of losses for Brent, the longest streak on record.

Phillip Nova analyst Priyanka Sachdeva said the muted price movement reflected a struggle between short-term geopolitical risks and longer-term market fundamentals that point towards oversupply.

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(Reporting by Arathy Somasekhar, Stephanie Kelly and Florence TanEditing by David Gregorio and Lisa Shumaker)