Key oil market gauges indicate that supplies are outstripping demand, overshadowing Saudi Arabia’s pledges that OPEC+ will deliver on its planned production cuts.

Saudi Arabia on Tuesday lowered its official crude selling prices to Asia for next month, a sign of market weakness as OPEC and its allies deepen output curbs to avoid a surplus. At the same time, U.S. crude exports are expected to hit a record of nearly 6 million barrels a day, pushing WTI timespreads to hover near February lows.

Underscoring the weakness, U.S. benchmark crude futures fell for a fourth day to a fresh five-month low. Traders remain unconvinced that new OPEC+ export curbs will materially tighten the market. Production from outside the alliance has consistently surpassed expectations this year, damping market bullishness.

“The voluntary element of the deal left the markets questioning whether the supply reduction would actually come into effect,” said Fiona Cincotta, financial market analyst at StoneX. Meanwhile, the demand outlook is being hurt by rising concerns about China, she said.

Still, Saudi Energy Minister Prince Abdulaziz bin Salman told Bloomberg News Monday that OPEC+ cuts would “overcome” an expected inventory build in the first quarter, and could be extended if needed. Russian President Vladimir Putin will travel to the United Arab Emirates and Saudi Arabia this week, according to people familiar with the plans. Moscow is a key member of the broader OPEC+ grouping.

The market is also grappling with how to deploy risk in the final month of a year in which Brent futures at one point slumped to US$70 a barrel, but also threatened a rally to $100.


  • WTI for January delivery declined 1 per cent to settle at $72.32 a barrel in New York.
  • Brent for February settlement slid 1 per cent to settle at $77.20 a barrel.