DTN Oil Update
Oil Prices Tumble 4% as OPEC Flags Q3 Glut
SECAUCUS, N.J. (DTN) -- Oil markets hit three-week lows Wednesday, Nov. 12, driving both the global benchmarks for crude below key thresholds, following OPEC's forecast of a supply glut for the third quarter.
The NYMEX WTI contract for December delivery settled down $2.55 at $58.49 bbl. ICE Brent for January delivery fell $2.52 to $62.64. The intraday low of $58.30 for WTI and $62.56 for Brent was the lowest since Oct. 22.
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The 4% drop on the day was the sharpest in a month for both crude benchmarks, leaving WTI below the key $60 bbl mark and Brent under the $65 threshold.
On the refined products side, December RBOB gasoline futures settled down $0.0566 at $1.9554 gallon and front-month ULSD futures closed down $0.0941 at $2.4816 gallon.
The U.S. Dollar Index, meanwhile, rose by 0.044 points to 99.36, adding to the weight on commodities priced in the U.S. currency.
Oil markets erased advances from three prior days after the Organization of the Petroleum Exporting Countries projected in its November monthly report a 500,000-bpd crude surplus for the third quarter, reversing the 400,000-bpd deficit it forecasted in October.
It was a rare pivot for a producer group usually more bullish with its forecasts on oil than the Paris-based International Energy Agency (IEA) and the U.S. Energy Information Administration (EIA).
The IEA, in its 2025 global energy outlook issued Wednesday, projected global oil demand will peak in 2030 under its Stated Policies Scenario, which includes announced government ambitions. However, its Current Policies Scenario, which only counts enacted laws, sees demand continue rising to 113 million bpd by 2050.
The EIA, in its Short-Term Energy Outlook, forecast Brent to average $69 bbl in 2025, $54 bbl in the first quarter of next year and $55 bbl through 2026.