MCX October crude oil futures slipped 0.5% to Rs 5440 per barrel in Friday’s Asian session, mirroring global weakness as WTI traded near $61 per barrel amid hopes of rising global inventories. Oil prices softened after Israel and Hamas reached the first phase of a US and Qatar-mediated ceasefire, easing geopolitical risk premiums built up in recent weeks. The dollar’s firm tone, with the index around 99 and heading for its strongest weekly gain in a year, added pressure on commodities. Still, the downside remained capped as traders weighed fresh US sanctions on more than 50 Iran-linked firms, vessels, and refineries, while OPEC+’s modest output increase signaled continued supply discipline.

Meanwhile, the EIA stated in its Short-Term Energy Outlook that it expects global oil inventories to rise through 2026, putting significant downward pressure on oil prices in the coming months. We forecast that the Brent crude oil price will fall to an average of $62 per barrel (b) in the fourth quarter of 2025 and $52/b in 2026. Global oil production. Global liquid fuels production increases throughout the forecast, which we expect will drive inventory accumulation. Production growth is led by countries outside of OPEC+, where production rises by 2.0 million b/d in 2025 and by 0.7 million b/d in 2026. OPEC+ increases total liquids production by 0.6 million b/d in both 2025 and 2026, as the group unwinds crude oil production cuts. However, we expect OPEC+ production will remain below announced targets, preventing inventory builds from accelerating too quickly and limiting the decrease in oil prices.

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