Oil Markets Decline as Supply Outpaces Demand, Geopolitical Factors Weigh
Oil markets extended their downward trajectory, with Brent crude slipping below $60 and WTI hitting $55. The decline, building for months, reflects a persistent supply glut as OPEC+ and producers across the Americas continue to flood the market. Weak demand forecasts for next year further exacerbate the imbalance.
Geopolitical tensions showed tentative signs of easing, with hopes for a potential settlement in Russia's war in Ukraine eroding the risk premium that had long supported crude prices. Meanwhile, U.S. sanctions on Venezuela and new EU restrictions on Russian oil operations added layers of uncertainty to global supply dynamics.
The European Union's latest sanctions package targeted traders facilitating Russian crude exports, banning EU citizens from business dealings with listed entities. Despite 19 sanction rounds and over 2,600 designations, Russia continues to redirect millions of barrels to India and China through a shadow fleet operating outside conventional maritime channels.
