"Mounting concerns of a global supply surplus weighed on the market, compounded by renewed trade tensions between the U.S. and China. The latest International Energy Agency (IEA) market report added to the concerns and forecasts a growing oversupply of oil. The IEA has increased its global supply growth projections to 3 million barrels per day for this year and 2.4 million for 2026, pointing to production hikes from OPEC+ and robust output from the Americas."
"In contrast, the agency has lowered its demand growth estimates to approximately 700,000 barrels per day for both years, reinforcing expectations of a significant surplus. Adding to the bearish outlook, trade tensions are injecting fresh uncertainty into the market. A brief rebound in prices on Monday, sparked by hopes for de-escalation in US-China trade talks, quickly faded. The market was further affected by a reduced geopolitical risk premium as hopes for stability in the Middle East grew."
Oil prices fell to a five-month low as markets weighed a growing global supply surplus and renewed U.S.-China trade tensions. The IEA raised global supply growth forecasts to 3 million bpd for this year and 2.4 million bpd for 2026, citing OPEC+ production increases and strong output from the Americas. The IEA trimmed projected demand growth to about 700,000 bpd for both years, reinforcing expectations of a substantial surplus. Trade tensions, a faded price rebound after hopes of de-escalation, and a reduced Middle East risk premium further pressured markets. Markets will monitor US-China relations, OPEC+ supply, and upcoming EIA inventory data.
Read at London Business News | Londonlovesbusiness.com
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