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Oil prices continue to plummet. Although they gained a few cents at the close of the London and New York markets on Friday, they remained at very low levels. “At the lowest since last May” and “close to a five-year low”, underlined the experts.
On the InterContinentalExchange (ICE) in London, the price of a barrel of Brent from the North Sea, for delivery in December, gained 0.38% to settle at $60.34 at market close on Friday. Its American equivalent, a barrel of West Texas Intermediate, for delivery in November, increased by only 0.14% to close at $57.54. On a weekly price basis, both benchmarks fell around 3%.
This situation takes place in a context where the International Energy Agency (IEA) anticipates an abundant supply of black gold for next year. But not only that. The growing tension between the two major global oil consumers, the United States and China, is exacerbating the markets and pushing prices down.
In its latest report, released last Tuesday, the IEA revised upwards its forecasts for growth in global oil supply compared to September forecasts. It also revised downwards very slightly its estimates of growth in demand for this year and the following year. This is why operators remain concerned about the balance between supply and demand, analysts observe.
In total, the IEA projects an additional oil supply of around 2.2 million barrels per day (mb/d) in 2025, but above all nearly 4 mb/d in 2026. The growth in supply is notably due to “the sharp increase in the oil supply by the Organization of the Petroleum Exporting Countries and their allies forming the OPEC+ alliance”, according to analyst Carsten Fritsch cited by specialist sites. Since April 2025, eight OPEC+ members have increased their quotas by more than 2.5 million barrels daily.
Market pressure is therefore observed against a backdrop of increasing OPEC+ production to regain market share after having spent several years reducing production to counterbalance the increase in non-OPEC production.
In the same context of increased availability of black gold, the American Energy Information Agency announced that crude oil stocks in the United States increased by approximately 3.5 million barrels.
Faced with the abundance of supply, demand risks not being there, the tense relations between the two largest consumers of black gold in the world being “likely to undermine their economy, and therefore the demand for oil, according to oil market experts. Furthermore, “the possibility of a disruption in the supply of Russian oil due to sanctions prevents crude prices from falling further,” they believe.