Oil Prices Slide Amid Growing Global Oversupply Concerns

Oil prices recovered slightly on Thursday after a sharp drop the day before, as traders weighed a mix of supply‑side concerns and an increasingly bearish demand outlook.

By 11:30 GMT, Brent crude futures were up around $63.03 a barrel, while U.S. West Texas Intermediate (WTI) crude rose to roughly $77 a barrel.

The modest uptick followed a steep decline the previous session, when Brent dropped nearly 3.8% and WTI about 4.2%.

Key Drivers

U.S. inventory build
Data from the American Petroleum Institute (API) indicated U.S. crude stocks rose by 1.3 million barrels in the week ending Nov 7.

Analysts noted inventory accumulation not only in the U.S., but also in Europe, Singapore and Fujairah, suggesting broader supply pressure.

OPEC’s revised outlook
OPEC reported that global supplies are expected to slightly exceed demand in 2026—a shift away from its previous view of a supply deficit.

The change in tone has triggered concern that the market may face a surplus next year, undermining prices.

Production growth everywhere
The International Energy Agency (IEA) raised its forecast for global oil supply growth this year and next.

Meanwhile, the U.S. Energy Information Administration (EIA) expects U.S. oil production to hit an even higher record than previously thought—fueling concerns about inventories growing faster than demand.

Possible support from Russian sanctions
On the upside, suppliers noted that tougher sanctions on Russian company Lukoil—effective after Nov 21—could disrupt exports and provide some support for prices.

Outlook

The near term appears uncertain. On the one hand, the risk of Russian export disruptions offers a potential floor—some analysts suggest support around the $60/barrel level.

On the other hand, the mounting data on production growth and inventory builds suggests the market may have to contend with a glut in 2026.

For oil market watchers, key items to monitor include:

The next weekly U.S. inventory release from the EIA for confirmation of the build trend.

OPEC monthly reports and the signal they send on supply‑demand balance.

The impact of sanctions on Russian oil flows and any resulting supply disruptions.

Whether global demand growth can pick up to absorb rising production.