(Nov 11): Oil fell as traders tracked softening market metrics and waited for reports that may give clues about an impending global surplus.
Brent dropped below US$64 a barrel after a two-day gain while the West Texas Intermediate was near US$60. WTI’s prompt spread — the gap between its two nearest contracts — has narrowed to 9 cents a barrel in backwardation. That’s the lowest since February and suggests less tight conditions.
Opec — which has been boosting supply — is due to release its monthly market analysis on Wednesday (Nov 12), with the International Energy Agency issuing an annual outlook the same day. The IEA has already forecast a record annual glut for 2026 and will update its view in a monthly snapshot on Thursday.
Oil has backtracked this year after posting losses over the past three months. The prolonged slump has been driven by widespread expectations for a global surplus, with Opec and its allies loosening output curbs just as drillers from outside the alliance also add barrels.
Other metrics point toward expectations for ample supplies. For Brent, the futures curve is essentially flat for the months from March right through to December 2026, before shifting more clearly into contango, a bearish pattern that’s marked by later-dated contracts being more pricey.
See also: Canada, Alberta ink deal to unlock oil pipeline, build carbon capture
Indian imports were also in focus. US President Donald Trump said Washington was getting “pretty close” to a trade deal with New Delhi and the country had “stopped doing the Russian oil”. Trump has pushed India to curb crude-buying from Moscow as part of efforts to end the war in Ukraine.
The US has sanctioned Russian energy giants Lukoil PJSC and Rosneft PJSC. Lukoil has declared force majeure on oil shipments from its giant West Qurna 2 field in Iraq, according to a person with knowledge of the matter.
Trading volumes may be subdued on Tuesday as it is a federal holiday in the US.
See also: LNG freight rates extend rally on strong North American exports
Prices:
- Brent for January settlement was 0.5% lower at $63.74 a barrel at 3.30pm in Singapore.
- WTI for December delivery dropped 0.6% to $59.79 a barrel.
Uploaded by Arion Yeow
