Crude dips on oversupply fears, trade tensions

October 15, 2025 (MLN): Oil prices declined for a second consecutive session on Wednesday, as investors reacted to the International Energy Agency’s forecast of a potential supply glut in 2026 and growing trade frictions between the United States and China that could dampen global demand.

Brent crude futures went up by $0.08, or 0.13%, to $62.31 per barrel.

West Texas Intermediate (WTI) crude futures decreased by $0.04, or o.07%, to $58.66 per barrel by [2:50 pm] PST.

The IEA said on Tuesday that global oil supplies could exceed demand by as much as 4 million barrels per day in 2026, a larger surplus than previously forecast.

The agency attributed the potential glut to rising production from OPEC+ members and rival producers, combined with sluggish demand growth.

“The market is increasingly focused on oversupply risks amid mixed demand indicators,” said Emril Jamil, senior oil analyst at LSEG. “Easing geopolitical risks and escalating trade frictions are putting additional downward pressure on prices.”

Tensions between the world’s two largest oil consumers have flared up again in recent days. Both Washington and Beijing have imposed higher port fees on cargo shipments between them, increasing trade costs and potentially disrupting global freight flows. Analysts warn that the move could dampen economic activity and fuel consumption.

“Market attention will remain on the renewed escalation of U.S.-China trade tensions and the broader risks they pose to global growth,” said Tony Sycamore, market analyst at IG.

The dispute has intensified since China informed tighter controls on rare earth exports, while U.S. President Donald Trump threatened to raise tariffs on Chinese goods to 100% and expand restrictions on software exports starting November 1.

“Beyond trade relations, oil markets are now driven by the scale of oversupply and changes in global inventory levels,” said Yang An, analyst at Haitong Futures.

Copyright Mettis Link News