DTN Oil Update
Oil Edges Lower as Traders Parse Oversupply Signals
VIENNA (DTN) -- Oil prices edged lower on Tuesday, Oct. 7, giving up some gains made in the previous session. The pullback followed OPEC+'s smaller-than-expected output hike for November and reports of damages to Russian oil infrastructure amid continued Ukrainian attacks.
In morning trade, NYMEX-traded WTI crude for November delivery slid $0.27 to $61.42 bbl, and ICE Brent for December delivery fell $0.26 to $65.21 bbl.
November RBOB gasoline futures retreated $0.0155 to $1.8861 gallon. ULSD futures bucked the trend, rising $0.0116 to $2.2559 gallon.
The U.S. Dollar Index strengthened by 0.398 points to 98.270 against a basket of foreign currencies.
On Monday, Oct. 6, Saudi Aramco issued official selling prices for November, leaving prices for light barrels to Asia unchanged and cutting prices for medium and heavy crude oil grades. This came the day following OPEC+ raising production quotas for November by a modest 137,000 bpd, against expectations of a larger increase, and was read as yet another sign that OPEC's demand growth expectations were at odds with their publicly communicated bullish forecasts.
Russia, meanwhile, is facing a growing fuel shortage after Ukrainian strikes target key oil infrastructure, including refinery units, storage tanks and pumping stations. After an attack over the weekend, one of Russia's largest refineries, located in Kirishi, halted operations on a 160,000-bpd crude distillation unit. Ukrainian strikes have damaged a significant portion of oil infrastructure for Russia to institute a partial diesel export ban last week. Additionally, Russian midstream companies warned buyers last month to expect less deliveries.
The U.S. Energy Information Administration is set to publish its newest short-term energy outlook today. In last month's report, EIA forecasted global inventory builds to average more than 2 million bpd from the third quarter of 2025 through the first quarter of 2026. Following OPEC+ continuing to raise production quotas past the originally aimed-for 2.2 million bpd, achieved in September, market observers will be on the lookout for adjustments to supply growth estimates and inventory forecasts. The International Energy Agency's as well as OPEC's oil market reports for October are scheduled for release next week.
Separately, the Bureau of Economic Analysis announced this morning that its monthly report on U.S. international trade in goods and services for August will not be published today as the federal government shutdown entered its seventh day.
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