BEIJING – Oil prices dropped slightly on Wednesday as global markets slumped and the US dollar strengthened, while traders evaluated the outlook for supply amid new OPEC+ production adjustments.
Brent crude futures fell by 6 cents, or 0.09%, to $64.38 a barrel by 0706 GMT, after hitting a near two-week low in the previous session. US West Texas Intermediate (WTI) crude slipped 7 cents, or 0.12%, to $60.49.
According to ANZ analysts, investors have been exiting energy markets amid a risk-off tone across global equities. Asian stocks fell sharply, and market volatility surged to levels unseen since April following a tech-led selloff on Wall Street.
Read More: Pakistan receives first US crude oil shipment, marks energy milestone
Meanwhile, the US dollar index hovered at a three-month high, supported by divisions within the Federal Reserve, suggesting low odds for an interest rate cut at the upcoming December policy meeting. A stronger dollar typically makes oil more expensive for buyers using other currencies, weighing on demand.
Tony Sycamore, market analyst at IG, noted that “crude oil is trading lower as risk sentiment shifted sharply negative, boosting the safe-haven US dollar, both of which weighed on oil prices.” Adding to the pressure, the American Petroleum Institute (API) reported a rise in US crude stockpiles for the week ending October 31.
On the supply side, OPEC+ announced plans to increase output by 137,000 barrels per day (bpd) in December while pausing further hikes in early 2026. However, analysts at LSEG warned that the pause is “unlikely to offer meaningful support” to near-term prices.
Read More: Oil prices rise as OPEC+ pauses production hikes
Despite the output rise, OPEC’s October production increased by only 30,000 bpd, as gains were offset by declines in Nigeria, Libya, and Venezuela. Meanwhile, Western sanctions on Russia and Iran have led to record volumes of oil stored at sea, preventing a global supply glut, according to the CEO of Gunvor Group, a Swiss-based commodities trading firm.