WASHINGTON (dpa-AFX) - Crude oil prices fell sharply on Thursday, triggered by the International Energy Agency's monthly report that boosted the supply estimate for 2025 and 2026, indicating a glut.
WTI Crude Oil for October delivery was last seen trading down by $1.22 (or 1.92%) at $62.45 per barrel.
In its monthly report, the Paris-based IEA forecast supply growth of 2.7 million barrels a day for 2025 and 2.1 million barrels a day in 2026. Earlier estimates were 2.5 million and 1.9 million bpd, respectively.
Earlier this week, the American Petroleum Institute had reported that US crude oil inventories rose by 1.25 million barrels for the week ending September 5.
The US Energy Information Administration reported that crude oil inventories climbed by 3.9 million barrels last week; gasoline inventories increased by 1.5 million barrels; and distillate fuel inventories (which include heating oil and diesel) jumped by 4.7 million barrels.
In Sunday's virtual meeting, OPEC+ agreed on plans to increase oil production by 137,000 barrels per day in October. Though the numbers were less than what traders speculated, concerns of oversupply are mounting.
Since April, OPEC+ has already completely unwound its first 2.5 million bpd of cuts (about 2.4% of global demand). The next meeting of the eight member OPEC+ is scheduled for October 5.
On the data front, US PPI and CPI numbers from yesterday and today have reinforced expectations that the US Federal Reserve may initiate a series of rate cuts this year. Rate cuts may affect the US dollar value and in turn crude oil prices.
As Russia continues its war with Ukraine, ignoring calls for a ceasefire, several Russian drones that strayed into Poland' airspace on Tuesday night were shot down by Poland, triggering fresh concerns of the NATO alliance turning the two-nation war into a wider conflict.
Russia is now on the verge of being hit by sanctions by the US and the West on its oil exports.
In the Middle East, fresh tensions have surfaced after Israeli forces conducted airstrikes on Qatari capital Doha targeting Hamas leaders, killing nearly seven. Even while Arab leaders have expressed solidarity with Qatar, Israel has vowed to eliminate all rebel leaders sheltered outside Palestine.
Sector-wise, some of the oil and gas sector industry's larger players, viz. ConcoPhillips, Chevron, BP, Petronas etc., are bracing for substantial job cuts due to several headwinds facing the industry.
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