Oil prices fell for the second day on Tuesday as the war of interests between the world’s two largest oil consumers, the US and China, and concerns about oversupply and demand risks continued to weigh on the market.
Brent crude futures fell 17 cents, or 0.28%, to $60.84 a barrel at 03:43 GMT. The November delivery WTI contract, due on Tuesday, fell 0.52% to $57.22. The more active December contract fell 19 cents, or 0.33%, to $56.83.
Prices fell to their lowest level since early May in Monday’s session on concerns that the recent escalation in the US-China trade dispute will slow economic growth.
Both WTI and Brent have transitioned to contango market structures, where immediate supply prices are lower than those for later deliveries, typically indicating ample short-term supply and weakening demand.
Prices have fallen as the OPEC+ allies continue their plans to release more oil to the market. This has led analysts to predict a crude oil glut this year and next. The International Energy Agency (IEA) last week projected a global oil surplus of approximately 4 million barrels per day in 2026.
The continued weakening of Brent’s monthly spread suggests that the pressure from oversupply in the crude oil market is increasing. This lowers market expectations and reduces investor risk appetite, limiting the potential for a recovery in oil prices.
The current pessimistic fundamentals for oil are likely to extend into fourth quarter of 2026.
Analysts attributed last week’s decline in Brent crude prices to indicators, suggesting that the long-awaited global surplus is beginning to emerge.
A preliminary survey released Monday showed U.S. crude oil inventories likely rose last week, ahead of weekly reports from the American Petroleum Institute (API) and the EIA.