By Van Ha Trinh, Financial Markets Strategist at Exness
Oil prices have stabilized to a certain extent in recent sessions, but could remain under pressure amid ongoing concerns around supply and demand levels. The increase in OPEC output during September has reinforced concerns about oversupply, and while a potential pause in production hikes after that could provide some short-term relief, traders are likely to remain cautious until there is clearer guidance from the next OPEC meeting. The market’s direction could depend on whether the group signals restraint in the coming months or prioritizes market share, as either direction could set the tone for Q4 pricing.
At the same time, Russia remains an important wild card. Although optimism around progress in negotiations has receded, a breakthrough could unlock additional flows of Russian crude into global markets, adding to the oversupply narrative. Conversely, ongoing sanctions risk could provide some support to prices if supply is tighter.
On the demand side, uncertainty remains. Traders could continue to monitor economic data releases in the US and China for clues on the direction of the economy. A softer trajectory in global demand would amplify the downside risk, leaving the market vulnerable to renewed selling pressure.