FX.co ★ Oil Edges Up, Still Hovers at 5-Month Low

On Wednesday, West Texas Intermediate (WTI) crude oil futures experienced a modest increase, reaching $58.9 per barrel, underpinned by positive sentiment surrounding potential interest rate cuts in the United States. Despite this uptick, prices remain close to a five-month low due to ongoing concerns about supply levels. The International Energy Agency has cautioned that the global oil market may face an unprecedented surplus in the coming year, with supply projected to exceed demand by nearly 4 million barrels per day. This surplus is attributed to increased production from OPEC+ and other significant producers, even as demand remains sluggish. Additionally, the persistent trade tensions between the US and China have exacerbated these concerns, heightening fears of diminished global demand. The latest developments in this trade conflict included both nations imposing new restrictions on shipping companies, although there were indications from US officials of a possible easing of these measures forthcoming. Market participants are now eagerly awaiting the release of US inventory data to gain new insights into demand patterns, especially as recent reports indicate potential rises in stockpiles while OPEC+ production returns to the market.