Crude oil prices steadied this morning and managed to push off multi-month lows hit yesterday. Crude began the week on the back foot, in a move which saw front-month WTI break below $56 per barrel to hit its lowest level since the beginning of May this year.
Prices have come under sustained selling pressure ever since WTI hit a six-week high of $66.30 near the end of September. Back then, prices pushed up as Ukraine launched a succession of successful attacks on Russia’s energy infrastructure. But since then, traders have focused on the facts of increased supply from other sources.
Source: TN Trader
Analysis from different agencies, while differing in terms of the actual number of barrels, all calculate that supply will continue to outstrip demand this year and next. This was despite the decision from OPEC+, which surprised traders earlier this month when they announced a production increase which was well below market expectations. But after a brief gap higher, oil prices continued their decline.
While there are signs that the US-China trade dispute is cooling down, the Trump administration's tariff programme could lead to a slowdown in economic activity, further weighing on global demand growth. This is already falling as the world pivots to alternative energy sources.
