Oil Heads for Monthly Loss as Traders Weigh Oversupply and Geopolitics
Oil prices edged lower and are expected to post a monthly loss, with trading dominated by concerns about a looming oversupply and geopolitical issues, including U.S.-led efforts to end the war in Ukraine.
Brent for November delivery traded below $68 a barrel, with the global benchmark about 5% lower this month. West Texas Intermediate fell near $64. Oil has weakened in August amid concerns that global supply will exceed demand in coming quarters, leading to a buildup in stockpiles.
Investors are also focused on Ukraine and a potential shift in crude oil flows away from Russia. U.S. President Donald Trump is "not happy" with Moscow's recent attacks on Ukraine, White House Press Secretary Karoline Leavitt said. Washington has imposed 50% levies on most Indian imports to punish the South Asian nation for buying Russian crude. Moscow launched a wave of drone and missile attacks on Kyiv earlier this week, defying U.S. calls for an end to the fighting, killing 18 people, Ukrainian authorities said.
A meeting between Ukrainian President Volodymyr Zelenskiy and Russia's Vladimir Putin is unlikely, according to German Chancellor Friedrich Merz. Trump has threatened "very serious consequences" if Moscow doesn't come to the negotiating table.
The August oil drop was the first monthly decline since April, when most commodities were hit by a sharp escalation in Trump's trade war and concerns that energy consumption would decline.
Concerns about a surplus, with the International Energy Agency predicting a record oversupply, follow the OPEC+ campaign to restore idle capacity. "More OPEC+ oil will enter the market amid concerns about US economic growth, which is keeping the market well supplied," said Jens Naervig Pedersen, a strategist at Danske Bank AS. "At the same time, the US appears ready to increase sanctions on buyers of Russian crude." (alg)
Source: Bloomberg
