Oil Markets See Weekly Gains Amid OPEC+ Supply Restraints and Geopolitical Concerns

Oil prices eased slightly during Asian trade on Friday, but the market is still poised to record a solid weekly gain driven by critical supply decisions and geopolitical uncertainties.

Key Factors Supporting Oil Prices:

1. OPEC+ Maintains Supply Cuts
   The Organization of the Petroleum Exporting Countries and its allies (OPEC+) have provided substantial support to oil markets by delaying planned production increases. This delay comes as the group continues to maintain nearly 6 million barrels per day of output cuts—initiated over the past two years to bolster prices—well into the coming months. The extension of these production curbs highlights OPEC+’s commitment to stabilizing the market amid ongoing demand concerns.
2. Potential U.S. Supply Disruptions
   In the United States, caution surrounding Hurricane Rafael has triggered precautionary evacuations of offshore drilling platforms in the oil-rich Gulf of Mexico. The potential for significant disruptions to U.S. energy output has added an extra layer of support to oil prices throughout the week.
3. Geopolitical Tensions in the Middle East
   Persistent conflict in the Middle East has further influenced oil market dynamics. Israel’s continued military operations in Gaza, alongside escalated tensions involving Hezbollah in Lebanon, have sustained a geopolitical risk premium on crude prices. The situation remains a critical factor that traders are monitoring closely.
4. Anticipation of China’s Economic Stimulus
   Oil markets are also looking to China, the world’s largest oil importer, for further cues. The National People’s Congress (NPC) meeting is expected to conclude with the announcement of additional fiscal stimulus measures aimed at bolstering economic growth. Analysts forecast at least 10 trillion yuan ($1.6 trillion) in new spending, potentially driving a recovery in Chinese oil demand.

Market Performance Recap:

• Brent Crude Futures: Down 0.3% to $75.44 per barrel.
• West Texas Intermediate (WTI) Crude Futures: Fell 0.3% to $71.72 per barrel.

Despite these minor losses, both Brent and WTI are up between 3% and 4% for the week, underscoring strong upward momentum. The combination of OPEC+ production constraints, weather-related supply concerns in the U.S., and geopolitical tensions has kept oil markets well-supported as they await further economic indicators from major global economies.