WTI crude oil is down $1.22 to $60.28. That breaks last week’s low and puts $60.00 squarely in focus.
OPEC+ helped give a lift to oil to start the week by only raising production 137K bpd for November but it’s all landing in a market that’s increasingly oversupplied. Higher summer demand and Chinese stockpiling has masked the excess barrels in the market but that’s coming to an end. Figures show massive amounts of crude on ships at the moment and they’re running out of places to put it. Historically, even small imbalances in the global oil market can lead to blowouts in prices.
Goldman Sachs was out with a note yesterday estimating an average surplus of 2.0 million barrels per day from Q4 of this year to Q4 2026. That’s assuming OPEC+ halts its monthly 137K bpd production increases in January (which would be announced in December). However they call a full unwind of the idled 1.65 mbpd ‘plausible’.
Even with the curb, they see WTI averaging $52 next year. That’s a crippling number for the market profitability and new drilling. It will inevitably lead to drilling curbs and US shale will rapidly decline by 2027.
Overall, we view our 2025Q4–2026 price forecast as two-sided but skewed modestly to the downside after a sharper decline in Russia production and the upside risk. A faster decline in perceived spare capacity and a likely slowdown in non-OPEC supply growth from 2027 also skew risks to long-dated oil prices to the upside.
Technically, a drop below $60 and and the June low of $59.74 would clear the way for a retest of the June low of $55.12
