Oil prices rose roughly 1% on Monday after OPEC+ revealed a more modest-than-anticipated production hike for November, easing some concerns about added supply. However, a soft outlook for demand is expected to limit near-term gains.
Brent crude climbed 67 cents, or 1%, to $65.20 a barrel by 0625 GMT, while U.S. West Texas Intermediate (WTI) rose 66 cents, or 1.1%, reaching $61.54.
“The price jump has primarily been boosted by OPEC+’s decision for a lower-than-expected production hike next month as the group intended to buffer the recent slump in oil markets,” said independent analyst Tina Teng.
OPEC+, which includes the Organization of the Petroleum Exporting Countries, Russia, and some smaller producers, announced that it would increase November output by 137,000 barrels per day (bpd)—the same small rise as in October—amid ongoing worries about a potential oversupply.
Ahead of the meeting, sources indicated that while Russia pushed for the 137,000 bpd increase to prevent further price pressure, Saudi Arabia preferred a higher figure—possibly double, triple, or quadruple—to regain market share more quickly.
Some analysts also noted that the upcoming refinery maintenance season in the Middle East is likely to limit further price gains.
“Higher-than-usual refinery maintenance across the Middle East in Q4 will leave more crude available for shipment, further contributing to the prospect of strong export volumes,” said Sentosa Shipbrokers in a client report.
Refinery shutdowns in other regions could similarly curb crude intake.
“As the shoulder season progresses… a ramp-up in refinery maintenance should create a significant surplus, spurring a selloff in oil,” BMI analysts noted.
Expectations of weak demand in Q4 provide additional restraint.
“With the absence of any fresh bullish catalysts and growing ambiguity on the demand outlook, oil prices are likely to stay capped despite OPEC+’s smaller-than-feared output hike,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.
“The reality is that the market is gradually shifting toward a phase of oversupply, with seasonal demand expected to taper off into winter and macro data offering little upside impulse,” she added.
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