Oil Prices Climb as Markets Weigh Demand, Supply Issues
In the global commodity market, crude oil prices continued to increase, albeit, slowly as the commodity markets grapple with supply and demand imbalances amidst U.S Government shutdown.
Investors see positive demand from China after World Bank increase Beijing growth forecast to 4.8% for 2025. Chinese demand has been fluctuating due to economic issues that lower imports.
India is buying Russian oil, and the relationship has attracted sanctions from the U.S with higher tariff on goods. On the supply side, tensions between Russian and Ukraine continues to impact both demand and supply. Ukrainian recent attack on Russian energy infrastructure further supported prices surges by fuelling supply disruption fears.
In the Middle East, hope lingers and the market anticipates supply boost if key players shed their swords in reactions to global leaders efforts to promote peace.
Latest report suggests that attack on Red Sea has reduced while Iran is planning to ramp up exports. Meanwhile, eight members of the OPEC+ group plan to increase output has triggered potential global supply surplus.
Brent crude was trading at $65.57 per barre, up 0.33% from the previous close of $65.35. US benchmark West Texas Intermediate (WTI) increased by 0.32% to $61.69 from $61.49 in the prior session.
On October 5, Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman agreed to raise November output by 137,000 barrels per day.
The measured decision reinforced market perceptions that the group remains focused on price stability rather than regaining market share, thereby lending support to prices.
Experts said the alliance is likely to maintain its cautious stance on boosting production amid forecasts of a supply surplus later this year and into 2026.
Rising geopolitical tensions, fuelled by Ukraine’s intensified attacks on Russian energy infrastructure, also supported oil prices by raising concerns over potential disruptions to Russia’s export capacity.
Meanwhile, in the US, uncertainty over when the federal government will reopen after its shutdown has heightened risk perception in global markets, prompting investors to adopt a cautious approach.
Analysts noted that the prevailing uncertainty, combined with concerns that the government shutdown could lead to broader economic slowdown, continues to limit the upward movement in prices. First Holdco YTD Return Tightens as Share Price Slips
