WASHINGTON (dpa-AFX) - Crude oil moved higher on Monday as the prospects of the U.S. government shutdown coming to a close brightened after Senators advanced a short-term funding bill, a development which eased tensions about the national economy and consumption.
WTI Crude Oil for December delivery was last seen trading up by $0.31 (or 0.52%) at $60.06 per barrel.
The U.S. government shutdown entered day number 41 today.
On Sunday night, U.S. Senate negotiators struck a deal to advance a short-term funding bill with the support of eight Democrats. After the Senate voting today, the bill should secure the support of House of Representatives, followed by president's signature to kickstart the funding.
From the market perspective, as signs of an end to the impasse are brightly showing now with around 750,000 unpaid federal employees to receive their salaries, sentiment remains boosted.
From an oil market perspective, if the U.S. government opens up again, domestic demand for goods and services including energy would increase, bolstering crude demand.
Additionally, improved risk appetite could shift funds into commodities like oil.
On the geopolitical front, in the Middle East, phase one of the Gaza Peace Plan proposed by President Donald Trump to end the Israel-Palestine war is now unwinding.
Today U.S. envoy Jared Kushner met with Israeli Prime Minister Benjamin Netanyahu in Jerusalem to ensure the ceasefire holds strong and the next phase of the truce commences seamlessly.
In Europe, as the Russia-Ukraine war enters day number 1,355, fierce fighting continues between the two forces with Russia pressing hard to seize Pokrovsk, the industrial hub of Ukraine's Donetsk region.
Recently, the U.S. and U.K. imposed sanctions on two oil Russian majors Rosneft and Lukoil. Trump also warned of severe 'penalty tariffs' on Russian oil purchasing nations.
The Russian sanctions take effect from November 21 but already China, India, and Turkey, the major Russian oil purchasers are exploring buying from the U.S., the Middle East and elsewhere.
Russian oil supply now stands disrupted prompting the nation to offer heavy discounts.
On November 2, the OPEC+ alliance announced their plans to raise output target for December by 137,000 barrels per day. Significantly, the group decided to pause on increases in the first quarter of 2026 citing 'seasonality' as the reason behind their decision.
In its recent report, the International Energy Agency forecasted that the global oil surplus would reach around 4 million barrels per day in 2026, marking the largest annual surplus on record. Despite potential supply disruptions, this excess could lead to a overhang in oil inventories and weigh down on prices.
Markets are awaiting the OPEC Monthly Oil Market Report for November 2025 is expected on November 12.
In addition, on the same day, the International Energy Agency is set to launch World Energy Outlook and the Oil Market Report on November 13.
Based on the recent private economic data from the U.S., investors are currently betting at 64.1% chances of a rate cut in the upcoming December meeting of the U.S. Federal Reserve.
Oil being a dollar-denominated commodity, the trajectory of oil prices could become clear after Fed's meeting which would impact the dollar price.
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