Oil costs fell to their lowest level in 5 months on Tuesday, extending their downward pattern.
That’s what Daniel Takieddine, Co-founder and CEO of Sky Hyperlinks Capital Group, mentioned in a market evaluation despatched to Rigzone right now.
“Mounting considerations of a worldwide provide surplus weighed available on the market, compounded by renewed commerce tensions between the U.S. and China,” Takieddine acknowledged within the evaluation.
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“The most recent Worldwide Vitality Company (IEA) market report added to the considerations and forecasts a rising oversupply of oil,” he added.
“The IEA has elevated its international provide development projections to 3 million barrels per day for this yr and a pair of.4 million for 2026, pointing to manufacturing hikes from OPEC+ and strong output from the Americas,” he continued.
“In distinction, the company has lowered its demand development estimates to roughly 700,000 barrels per day for each years, reinforcing expectations of a big surplus,” Takieddine warned.
The Sky Hyperlinks Capital Group CEO went on to state within the evaluation that commerce tensions are injecting recent uncertainty into the market.
“A quick rebound in costs on Monday, sparked by hopes for de-escalation in U.S.-China commerce talks, shortly light,” he mentioned.
“The market was additional affected by a diminished geopolitical threat premium as hopes for stability within the Center East grew,” he added.
Trying forward, Takieddine famous within the evaluation that markets might intently monitor U.S.-China relations, OPEC+ provide, and upcoming stock information from the EIA (Vitality Info Administration) “to find out the market’s subsequent route”.
“With out a optimistic shock from stock stories or broader macroeconomic information, costs might stay below stress,” he warned.
In a separate assertion despatched to Rigzone this morning, Naeem Aslam, Chief Market Analyst at Zay Capital Markets, highlighted that the Brent and West Texas Intermediate oil costs have been “reflecting the steadiness between geopolitical tensions, financial insurance policies, and market sentiment”.
“Issues about oversupply stay, particularly because the IEA predicts a build-up in international oil shares within the second half of 2025,” Aslam mentioned within the assertion.
“The EIA has additionally raised its U.S. oil output forecast to 13.5 million barrels per day by 2026, fueling worries about additional oversupply,” Aslam added.
“Regardless of this, geopolitical components, like President Trump’s remarks on U.S.-China commerce and the Center East, proceed to affect the market. His feedback have traditionally created volatility but additionally provide potential for improved international financial outlook and oil demand,” Aslam continued.
The Chief Market Analyst went on to state that “key financial indicators, together with wage development and jobless claims, will sign the energy of the economic system and have an effect on oil demand”.
“Robust information might enhance costs, whereas weaker information could stress them decrease,” Aslam warned within the assertion.
“Speeches from key figures like Fed Chairman Jerome Powell and Financial institution of England Governor Andrew Bailey may additionally influence oil market dynamics. The mixture of those components will form near-term oil,” Aslam continued.
In a analysis notice despatched to Rigzone by the JPM Commodities Analysis crew late Monday, J.P. Morgan analysts, together with Natasha Kaneva, head of worldwide commodities technique on the firm, mentioned, “the estimated worth of open curiosity in vitality markets declined by -$8.2 billion WOW [week on week]”.
“The decline was primarily led by crude oil markets, and regardless of practically $7 billion WOW of contract-based inflows into the sector, as oil costs continued to retreat (WTI -3.3 %, Brent -2.8 %),” the analysts added.
“Our oil strategists notice that softer oil balances forward make the enforcement of sanctions on Russia the important thing bullish issue for oil markets,” they continued.
The J.P. Morgan analysts acknowledged within the notice that the estimated worth of open curiosity throughout pure gasoline markets “was largely steady on the week, up $0.2 billion WOW, primarily pushed by $2.7 billion WOW of contract-based inflows”.
“Our gasoline strategists notice that international LNG commerce in September 2025 reached 47.1 Bcm (-8 % MoM, +1.8 % YoY), as China’s LNG imports totaled 7.5 Bcm in August (-21 % YoY),” they added.
To contact the writer, e mail andreas.exarheas@rigzone.com
