DTN Oil Update
Oil Future Rise; WTI trades at $62 Despite Glut Fears
SECAUCUS, N.J. (DTN) -- Oil futures rose for a third straight day on Tuesday, Oct. 7, but market sentiment was weak as traders brooded over Saudi Arabia's decision to keep the selling official price of its crude to Asia unchanged, amid OPEC+ output increases.
NYMEX-traded WTI crude for November delivery settled up $0.31 at $62.00 bbl.
ICE Brent for December delivery rose $0.24 to $65.71 bbl.
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November RBOB gasoline futures rose $0.0012 to $1.9028 gallon. ULSD futures rose $0.0310 to $2.2753 gallon.
The U.S. Dollar Index strengthened by 0.488 points to 98.295 against a basket of foreign currencies.
After trading lower for most of the day, oil futures bounced up in the last half hour.
The downside earlier in the day came after the Saudis left the official selling price (OSP) for Arab Light at $2.20 bbl above the Oman/Dubai benchmark for November loadings. The decision surprised traders who had expected at least a slight mark up in the price.
Saudi Arabia, however, dropped its OSP for U.S.-bound crude by $0.50. They also cut $1.20 bbl on all grades sold to Northwest Europe and the Mediterranean.
The pricing decision for Asia, the primary for destination for Arab Light, appeared to reflect caution by state-owned Saudi Aramco after the back-to-back production hikes of 137,000 bpd for October and November by the OPEC+ alliance.
The U.S. Energy Information Administration said in its Short-Term Energy Outlook for October that it expected weaker prices for Brent and WTI in the fourth quarter due to the global stockpile situation in crude.
Brent is expected to average $62 bbl in the fourth quarter, versus the $69 bbl average anticipated for all of this year, the EIA said. That is below the $81 bbl average for 2024.
EIA expects WTI to average $58 bbl in the fourth quarter from $65.79 in the third. For all of 2025, the U.S. crude benchmark is expected to average $65 bbl, compared to the 2024 average of $76.60.
Inventory growth is projected to continue into next year, averaging 2.1 million bpd, the EIA said. The agency noted that the forecasted fourth quarter 2025 build is higher than last month's estimate, following the OPEC+ hikes.