Oil Dips as Traders Zero in on Prospect of More OPEC+ Supplies

(Bloomberg) — Oil declined as signals that OPEC+ will hike production again in November, plus the restart of a pipeline from Iraq, exacerbated concerns about a worldwide glut.

Brent fell back below $70 a barrel after advancing by more than 5% last week, while West Texas Intermediate was near $65. The alliance led by Saudi Arabia is considering raising output by at least as much as the 137,000 barrel-a-day hike scheduled for next month, according to people familiar with the plans.

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Still, the group’s planned October hike is much lower than the increments announced for prior months. In addition, delegates have emphasized that some members lack the ability to produce much more.

In Iraq, meanwhile, flows via a pipeline that ships crude from the country’s northern region to a terminal in Turkey restarted in recent days after a halt of more than two years. Amer Al-Mehairi, director general of Iraq’s North Oil Co., said the resumption of exports along the conduit was continuing.

Crude remains on track for a monthly and quarterly gain, even as the Organization of the Petroleum Exporting Countries and its allies have been pursuing a strategy to reclaim market share rather than their typical role of managing prices. Oil has been underpinned by robust buying for stockpiling in China, as well as on geopolitical tensions, including Ukraine’s strikes against Moscow’s energy infrastructure.

“We view a repeat of the incremental 137,000-barrel-a-day addition for November as the most likely outcome,” RBC Capital Markets LLC analysts including Helima Croft said in a note, referring to the decision at the Oct. 5 meeting. Still, while the market’s dominant recent narrative has been one of oversupply, “participants are starting to factor in the accelerating wake-up risk posed by the ongoing Russia and Iran conflicts,” they added.

The International Energy Agency has projected a record glut in 2026 as OPEC+ continues to revive production, and supply climbs from the group’s rivals. Goldman Sachs Group Inc., meanwhile, has said it sees Brent falling to the mid-$50s a barrel next year, despite the crude stockpiling from China.

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