Oil prices slip as U.S. demand weakens and supply risks weigh on market

September 11, 2025 (MLN): Oil prices edged lower on Thursday, reversing some of the gains made earlier this week, as signs of weaker U.S. demand and rising global supply overshadowed geopolitical concerns in the Middle East and Europe.

Brent crude futures went up by $0.08, or 0.12%, to $67.41 per barrel.

West Texas Intermediate (WTI) crude futures decreased by $0.08, or 0.13%, to $63.59 per barrel by [11:45 am] PST.

Both Brent and U.S. crude benchmarks had climbed more than a dollar on Wednesday after Israel targeted Hamas leadership in Qatar and Poland activated its air defences, alongside NATO, to intercept suspected Russian drones straying into its airspace during attacks on western Ukraine.

 Despite the heightened tensions, traders judged the incidents posed no immediate threat to oil flows.

The recent rally followed a rebound in prices through much of September, after crude had dropped to a three-month low on September 5.

But attention has now shifted firmly to supply-demand fundamentals. Data from the U.S. Energy Information Administration (EIA) showed crude inventories rising by 3.9 million barrels in the week ending September 5, contrary to expectations of a 1m barrel draw. Gasoline stocks also increased by 1.5m barrels, against forecasts for a small decline.

The build-up in inventories comes as the U.S. economy shows further signs of slowing, with weaker labour market indicators and falling producer prices pointing to softening demand.

The European Central Bank, by contrast, is expected to hold rates steady on Thursday.

On the production side, OPEC and its partners agreed on Sunday to modestly raise output starting in October. While the increase is smaller than in previous months, the move still adds downward pressure on prices.

The EIA warned this week that higher supply is likely to drive a significant build in global oil stocks, setting the stage for further price declines in the coming months.

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