Oil prices continued their downward slide on Wednesday, extending losses from the previous session as investors reacted to a warning from the International Energy Agency (IEA) about a looming supply surplus and growing concerns over U.S.-China trade frictions that could dampen global demand.
By 07:40 AM WAT, Brent crude futures were down 9 cents, or 0.14%, to $62.30 a barrel, while U.S. West Texas Intermediate (WTI) eased 3 cents, or 0.05%, to $58.67 a barrel. Both contracts closed at five-month lows in the previous trading session.
The IEA said on Tuesday that the global oil market could swing into a surplus of as much as four million barrels per day in 2026, a larger glut than previously anticipated, as OPEC+ producers and competitors ramp up output amid sluggish demand recovery.
Trade tensions between Washington and Beijing have also reemerged, threatening to pressure demand further. Both nations have introduced new port fees on cargo shipments, a move expected to raise trading costs and disrupt freight flows, potentially weighing on global economic activity.
The dispute intensified last week after China expanded export controls on rare earth materials, while U.S. President Donald Trump warned of tariff increases of up to 100% on Chinese goods and tighter restrictions on software exports from November 1.
Market participants are now turning their attention to U.S. crude inventory data for signs of domestic demand strength. A preliminary Reuters poll showed analysts expect crude stockpiles to have risen more than about 200,000 barrels in the week to October 10, while gasoline and distillate inventories likely declined.
In a related development, Orsted, one of the world’s largest renewable energy firms, continues to face challenges from rising costs linked to supply chain disruptions and inflation, despite rapid expansion over the past decade.
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