The January Brent crude contract slid to 80.91 dollars per barrel, marking the lowest point since July 24, 2023, according to currency trading data from ICE. This move reflects a period of renewed volatility in the oil market as traders reassess supply and demand dynamics on multiple fronts.
By 14:07 Moscow time, the benchmark managed a modest rebound, advancing to 81.05 dollars a barrel while U.S. West Texas Intermediate (WTI) steadied at around 76.74 dollars per barrel. Market observers note that prices remain under pressure amid growing signals of softer demand in both the United States and China, a theme echoed by participants in Reuters polls and industry briefings. [CITATION: Reuters]
The U.S. Energy Information Administration lowered its outlook for U.S. oil consumption, trimming the expected increase for 2023 by about 300,000 barrels per day. The agency also highlighted that China’s import indicators suggest a cooling pace in the economy of the world’s largest oil importer, which could translate into weaker consumption patterns in coming quarters. [CITATION: EIA]
Meanwhile, a new wave of supply appears to be hitting the market. OPEC members boosted exports by roughly 1 million barrels per day relative to August, continuing a trend that some analysts argue overshoots what the market can absorb. In parallel, UBS analysts contend that current OPEC+ supply levels may exceed market needs, adding to downward pressure alongside the strengthening dollar. [CITATION: UBS]
Industry voices remain divided, with a sizable share of experts describing the oil balance as softened by supply gluts and tepid demand growth rather than a tight, scarcity-driven market. This sentiment aligns with ongoing discussion about price ceilings and the strategic use of reserves to stabilize markets when necessary. [CITATION: Market Briefing]
Earlier commentary from analysts touched on the share of oil revenues in the Russian budget, indicating the government’s exposure to price fluctuations is a persistent factor in policy and fiscal planning. [CITATION: Market Analysis]
Data from recent months also suggest that Russia’s crude resources have reached a multi-month high in certain metrics, underscoring the country’s role as a key supplier in the broader energy landscape and its potential influence on price trajectories going forward. [CITATION: Energy Watch]