Crude oil prices were lower today as the market could continue to see bearish risks, although WTI remained within the price range recorded during the last few weeks. The market remained dominated by an oversupply narrative.
With surplus projections dominating next year’s outlook, including the IEA’s forecast of a potential 4 mb/d surplus in 2026, the market could continue to see selling pressures. As such, price spikes induced by geopolitical risks could be seen as selling opportunities.
At the same time, the latest API report signaled a substantial 4.4 million-barrel build in US crude stocks. This marks the third increase in four weeks, which could continue to weigh on sentiment.
Traders are now bracing for today’s EIA data. This comes after last week’s report confirming a massive 6.4 million-barrel build. If today’s official numbers mirror the API’s trend, crude prices could come under renewed pressure.
Meanwhile, the looming US sanctions 21 November deadline on Rosneft and Lukoil could provide a floor for oil prices to a certain extent, but could remain insufficient to reverse the negative sentiment.
Photo by Jan-Rune Smenes Reite: