Oil prices edged about 1% higher on Wednesday as investor sentiment improved after OPEC+ agreed to limit next month’s production increase, easing fears of an oversupplied market.
By 0715 GMT, Brent crude futures were up 63 cents, or 0.96%, at $66.08 per barrel, while U.S. West Texas Intermediate (WTI) gained 66 cents, or 1.07%, to $62.39. The two benchmarks ended Tuesday’s session little changed as traders balanced worries over a potential supply glut against the smaller-than-anticipated rise in November output announced by the Organization of the Petroleum Exporting Countries (OPEC) and its allies.
“The market is in price limbo, with one side bent towards a possible supply glut and the other believing the ramp-up will not be as fast as anticipated,” said Emril Jamil, senior analyst at LSEG Oil Research.
Jamil added that prices are currently supported as traders maintain long positions—bets that prices will continue to rise—amid ongoing efforts to restrict the flow of Russian crude.
Over the weekend, OPEC+ agreed to increase production by just 137,000 barrels per day, the smallest rise among several options under consideration.
“Until the physical market shows signs of softening via rising inventories, investors are likely to discount the impact of the production increases,” ANZ analysts said on Wednesday.
However, the upside for prices remains limited as concerns over Russian supply disruptions have eased. Crude shipments from Russia have stayed near a 16-month high over the past four weeks, ANZ analysts added.
Investors are now awaiting the U.S. Energy Information Administration (EIA)’s weekly inventory report, due later Wednesday. Preliminary data from the American Petroleum Institute (API) showed U.S. crude stocks rose by 2.78 million barrels in the week ending October 3, while gasoline and distillate inventories declined, according to market sources.
Meanwhile, the EIA said on Tuesday that U.S. oil production is on track to hit a new record this year—an increase larger than previously forecast.
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