Key Moments
- Brent crude traded below $60 a barrel on Friday, ending the week down more than 2%, while West Texas Intermediate hovered near $56 a barrel.
- Meanwhile, major oil traders, including Trafigura, expect the global crude market to remain oversupplied in early 2026. They project Brent will stay in the $50s through mid-next year.
- So far this year, oil prices have declined about 20%. This drop occurred as OPEC+ and non-OPEC production increased, despite ongoing geopolitical risks and muted demand growth.
Futures Under Pressure for a Second Week
Oil benchmarks headed for a second weekly decline, as mounting supply concerns weighed on sentiment, according to Bloomberg. Traders focused on signs of a growing global glut rather than potential output disruptions.
On Friday, Brent crude traded below $60 a barrel, dropping more than 2% for the week. Similarly, West Texas Intermediate held near $56 a barrel, showing subdued price action.
| Benchmark | Price Level | Weekly Move |
|---|---|---|
| Brent crude | Below $60 a barrel | Down more than 2% |
| West Texas Intermediate (WTI) | Near $56 a barrel | Not specified |
Traders See Persistent Surplus Into 2026
Most of the largest global oil trading houses expect an oversupplied market in early 2026, Bloomberg reported. For instance, Trafigura projects Brent will stay in the $50s through mid-next year, reflecting a cautious view on prices.
| Outlook | Expectation |
|---|---|
| Market balance | Oversupply in early 2026 |
| Trafigura Brent price view | In the $50s through mid-next year |
OPEC+ Supply, Non-OPEC Output, and Weak Demand Pressure Prices
Crude has fallen about 20% this year. OPEC+ restored production faster than expected, while non-OPEC producers also increased output. Meanwhile, demand growth stayed muted, reinforcing the perception of a structural surplus.
Geopolitical risks, especially from Russia and Venezuela, supported prices to some extent. However, they could not reverse the overall downward trend in the market.
Market Sentiment: Structural Surplus in Focus
Bloomberg cited Haris Khurshid, chief investment officer at Karobaar Capital LP in Chicago, on the current market mindset. “The dominant sentiment right now is definitely a structural surplus,” Khurshid said. “That glut mindset outweighs geopolitical flare-ups from Russia to Venezuela.”
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