Oil Prices Settle Lower

Oil prices settled lower on Wednesday as a softer demand outlook continued to weigh on sentiment.

At 2:30 p.m. ET (19:30 GMT), Brent oil futures fell 0.2% to $73.41 a barrel, while West Texas Intermediate (WTI) crude futures fell 0.4% to $70.02 a barrel.

Oversupply Concerns Persist

The International Energy Agency (IEA) forecasted a global oil supply increase of 630,000 barrels per day (bpd) this year and 1.9 million bpd in 2025, reaching 104.8 million bpd.

Supply growth is expected to outstrip demand, with the IEA projecting global oil demand growth to accelerate from 840,000 bpd in 2024 to 1.1 million bpd in 2025. This report followed OPEC's monthly report in which the group cut its oil demand growth forecast.

Oil Prices to Fall Sharply in 2025 – BofA

Concerns about a supply surplus continue to draw bearish calls for oil prices. Analysts from Bank of America forecast a drop of more than 10% in oil prices next year.

This pessimistic outlook is primarily due to rising non-OPEC supply and sluggish global growth, leading to a predicted surplus in 2025. The analysts forecast WTI crude to average $61 per barrel in 2024, with Brent at $65 per barrel.

> “Given the oversupply narrative for 2025, it is hard to build a bullish case for oil prices,” the analysts commented, adding that OPEC+ is likely to maintain voluntary production cuts unless demand surprises positively or supply disruptions occur.