Oil Prices Steady Ahead of OPEC Meeting Amid Supply Concerns

Highlights:

• Oil prices stabilise: Brent crude for December hovered near US$66 per barrel at the time of writing, while WTI traded above US$62 after a two-day slide.
• OPEC+ meeting in focus: The alliance is set to discuss potential accelerated supply hikes, though OPEC has denied having a concrete plan.
• Market pressures persist: Fears of a US government shutdown and IEA’s forecast of a record oil surplus next year weighed on sentiment.

Oil prices stabilised on Wednesday after two consecutive days of declines, as traders turned their focus to the upcoming OPEC+ meeting, where discussions about accelerating supply hikes are expected to take centre stage.

Market Overview

Brent crude futures for December delivery traded near US$66 per barrel at the time of writing, after slipping nearly 5 per cent during the first two days of the week. Meanwhile, West Texas Intermediate (WTI) held above US$62 per barrel.The alliance known as OPEC+, which links the Organisation of the Petroleum Exporting Countries with several partner nations, is preparing to convene later this weekend. According to a delegate, the alliance may consider advancing its next round of output increases by implementing three monthly installments of 500,000 barrels a day to regain market share. However, OPEC clarified in an official statement that it currently has no such proposal under consideration.

Broader Market Sentiment

Investor sentiment was also shaped by looming political uncertainty in the United States. Market participants were closely watching the risk of a potential US government shutdown if Congress fails to reach a funding agreement by midnight in Washington. US equity futures and Asian shares edged lower in early trading sessions as the deadline approached.

Demand-Supply Dynamics

Crude oil prices recorded back-to-back monthly losses in September, primarily due to earlier OPEC+ supply hikes that raised concerns about global output outpacing demand. While China’s stockpiling activities — as the world’s largest oil importer — have provided some cushion to prices in recent quarters, the International Energy Agency (IEA) has forecast a record surplus in oil supply next year, further weighing on market sentiment. As traders await this weekend’s OPEC+ decision, markets remain cautious, balancing supply outlooks against uncertain global demand trends.

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