Oil Prices Decline Amid Concerns of Global Supply Surplus
Oil prices continued to decline for a second straight session on Thursday, impacted by market concerns over a potential global supply surplus compared to actual demand, following a report indicating a rise in U.S. inventories.
As of 02:34 GMT, Brent crude futures saw a slight decrease of three cents, or 0.03%, reaching $62.69 per barrel, after a significant drop of 3.8% in the previous session.
Similarly, West Texas Intermediate futures fell by five cents, or 0.09%, to $58.44 per barrel, marking further losses following a 4.2% decline on Wednesday.
Market sources, citing data from the American Petroleum Institute released on Wednesday, reported that "U.S. crude stocks increased by approximately 1.3 million barrels for the week ending November 7." They also noted a decline in gasoline and distillate inventories.
The latest monthly report from the Organization of the Petroleum Exporting Countries (OPEC) also contributed to the selling pressure, indicating that "global supply will slightly exceed demand by 2026," a shift from previous estimates that anticipated a supply deficit. OPEC also forecasts "a supply surplus next year, supported by increased production from several OPEC+ countries."
Additionally, nine analysts surveyed by Reuters projected "an increase in U.S. inventories of about two million barrels on average."
The Energy Information Administration (EIA) stated in its short-term energy outlook that "U.S. oil production is expected to reach a record level this year, surpassing previous estimates."
Market participants are now awaiting official inventory data to be released later today by the EIA, which is expected to provide a clearer picture of supply and demand trends.
