Key Points
- WTI crude (CL-OIL-ECN) rose 0.39% to $59.84, while Brent traded near $63.69.
- Market sentiment improved after OPEC+ signalled it may pause further production increases in Q1 2026.
- U.S. crude inventories rose 5.2 million barrels last week, highlighting ongoing demand weakness.
Crude prices ticked higher on Thursday, reversing part of Wednesday’s losses as oversupply fears softened. The West Texas Intermediate (WTI) benchmark climbed 0.39% to $59.84, while Brent crude rose 0.27% to $63.69, after three consecutive monthly declines.
Traders cited easing production anxieties after OPEC+ confirmed it will pause output increases in early 2026, while recent U.S. and U.K. sanctions on Russian energy giants tempered the bearish tone seen in October.
Our research desk notes this as a marked shift in price momentum as markets begin to stabilise following weeks of aggressive selling.
Demand Concerns Linger
Despite the rebound, analysts remain cautious. J.P. Morgan noted that global oil demand has risen 850,000 barrels per day year-to-date, falling short of earlier expectations of 900,000 bpd, while high-frequency indicators point to subdued U.S. consumption due to weaker travel and shipping activity.
Adding to the pressure, the EIA reported a 5.2 million barrel rise in U.S. crude inventories last week, well above the expected 600,000-barrel build, reinforcing fears of sluggish short-term demand.
Technical Analysis
Crude oil prices steadied near $59.84, recovering slightly after earlier weakness but still trading near the lower end of their short-term range.
The 15-minute chart shows prices consolidating above support at $59.50, with momentum indicators hinting at a mild rebound.
The moving averages are beginning to flatten, and the MACD histogram has turned slightly positive, suggesting buyers are tentatively re-entering after the recent drop from the $61.00 level.
Fundamentally, the market remains caught between conflicting forces. OPEC+’s decision to pause production increases for early 2026 has helped stabilise sentiment, but weak global demand from China and Europe continues to cap gains. U.S. inventory data also showed a modest build this week, reinforcing concerns that the market remains oversupplied despite output restraint.
Looking ahead, traders should watch whether oil can reclaim and hold above the $61.00–$61.50 zone, which could signal a short-term bullish reversal.
However, if prices slip back below $59.00, it may trigger renewed downside toward $57.00 or lower. In the near term, sentiment remains fragile, and direction will likely hinge on incoming demand data and fresh commentary from OPEC or U.S. producers.
Outlook
The market remains fragile as traders weigh mixed supply and demand signals. While OPEC+ restraint and sanctions on Russia may limit the downside, rising inventories and softer consumption are likely to cap upside momentum.
In the near term, oil is expected to trade range-bound, with volatility likely to pick up ahead of the IEA monthly report and next week’s U.S. inflation data that could reshape risk appetite across commodities.
