Oil prices gained around 1% on Monday after OPEC+ unveiled a smaller-than-expected boost in production for November, easing some supply concerns, though a subdued demand outlook may limit further short-term gains.
Brent crude futures rose 67 cents, or 1%, to $65.20 a barrel by 0625 GMT, while U.S. West Texas Intermediate crude increased 66 cents, or 1.1%, to $61.54.
“The price jump has primarily been boosted by OPEC+’s decision for a lower-than-expected production hike next month as the group intended to buffer the recent slump in oil markets,” said independent analyst Tina Teng.
On Sunday, OPEC+—comprising the Organization of the Petroleum Exporting Countries, Russia, and several smaller producers—announced a November production increase of 137,000 barrels per day (bpd), the same modest rise as in October, amid ongoing concerns about a potential supply glut.
Ahead of the decision, sources noted that while Russia favored the 137,000 bpd increase to avoid further price pressure, Saudi Arabia had advocated for a higher boost—potentially double, triple, or quadruple—to regain market share faster.
In the short term, analysts expect the upcoming refinery maintenance season in the Middle East to help cap prices.
“Higher-than-usual refinery maintenance across the Middle East in Q4 will leave more crude available for shipment, further contributing to the prospect of strong export volumes,” said Sentosa Shipbrokers in a client report.
Refiners in other regions may also scale back their crude intake during shutdowns.
“As the shoulder season progresses… a ramp-up in refinery maintenance should create a significant surplus, spurring a selloff in oil,” BMI analysts noted in a client briefing.
Concerns over weak demand fundamentals in Q4 add further restraint to the market.
“With the absence of any fresh bullish catalysts and growing ambiguity on the demand outlook, oil prices are likely to stay capped despite OPEC+’s smaller-than-feared output hike,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.
“The reality is that the market is gradually shifting toward a phase of oversupply, with seasonal demand expected to taper off into winter and macro data offering little upside impulse,” she added.
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