Slight Rebound, Long-Lasting?
Oil prices continued to rise on Tuesday after OPEC+ increased November production by only 137,000 bpd, less than expected. Concerns about oversupply have eased. Brent rose $0.23 (0.35%) to $65.70/barrel at 03:56 GMT, while WTI rose $0.21 (0.34%) to $61.90. The day before, both contracts had closed up more than 1% following the OPEC+ decision, which ING analysts interpreted as a sign of caution amid projections of a supply surplus in the fourth quarter and next year.
LSEG analyst Anh Pham believes the slight rebound is reasonable, as Brent fell by around $5/barrel last week due to expectations of a larger supply increase. For now, the market can still absorb additional volumes and has not yet seen a shift into contango at the beginning of the curve. So far this year, OPEC+ has increased its production target by more than 2.7 million bpd (≈2.5% of global demand). Geopolitical factors are keeping prices in check: the Russia-Ukraine war poses a threat, and Russia's Kirishi refinery shut down its CDU-6 unit after a drone attack (recovery is estimated to take ~1 month).
However, room for upside appears limited. Additional supply from OPEC+ and non-OPEC producers, coupled with a slowing demand outlook—pressured by global growth and US trade tariffs—has the potential to widen the surplus. Going forward, the market will consider production fulfillment, refinery maintenance seasons, and demand signals (mobility, refinery, and macro data) to assess whether price increases will continue or subside. (az)
Source: Newsmaker.id
