Oil prices fell on Friday after OPEC+ postponed planned supply hikes and extended the end of deep production cuts until the end of 2026 on concerns about weak demand.
Brent crude futures were down 6 cents, or 0.1%, at $72.03 a barrel by 0336 GMT. WTI crude futures were down 1 cent to $68.29 a barrel.
Brent had been expected to fall more than 1% for the week, while WTI gained marginally 0.1%.
OPEC+ on Thursday postponed the start of oil output hikes by three months to April and extended the end of the cuts by a year to the end of 2026.
The group had planned to end the cuts in October 2024, but slowing global demand and rising production have forced several postponements.
Aside from last week’s surprise drop in US crude inventories and OPEC+’s extension of plans to increase production to September 2026, oil prices have fallen further amid growing concerns about weakening global demand and oversupplied markets.
With growing concerns about global oil demand in 2025, even the softening of the US dollar in the last few sessions appears unlikely to correct the ground under oil prices.
The latest extension brings OPEC+ production below major banks’ previous forecasts, which could support the market in the future.
However, concerns that supply will exceed demand even next year are weighing on prices further.
Saudi Arabian oil production is also forecast to remain in the low 9 million bpd range in 2025. Still, even with this supply discipline, the market is expected to be oversupplied by more than 1 million bpd.
Looking ahead to next year, a heavy surplus is forecast as non-OPEC supply growth offsets below-trend demand growth, dampening demand for OPEC supply and limiting the need for OPEC+ to reverse voluntary cuts.
Markets are also eyeing the U.S. nonfarm payrolls report due Friday to see if it supports expectations for a rate cut at the Fed’s next meeting.
The market is pricing in a 72% chance that the Fed will cut rates by 25 basis points at its Dec. 17-18 meeting, up from 66.5% a week ago.
Clarity on rate cuts at the Fed’s policy meeting could be reflected in oil demand forecasts in 2025.
