Crude Oil Prices Rise After Weekly Fall as Supply Glut, China Demand Concerns Persist

Crude Oil prices moved slightly higher in early Asian trading on Monday after suffering sharp losses last week. However, gains remained limited as traders continued to worry about excess global supply and weak demand.

Brent crude futures rose about 0.5% to around $61.4 per barrel, while WTI crude climbed nearly 0.6% to about $57.8 per barrel.

Weekly Losses Still Weigh on Sentiment

Despite the small rebound, both Brent and WTI fell more than 4% last week. Prices dropped as investors focused on rising production from major oil producers and high global inventories.

Market participants remain cautious, as supply growth is seen outpacing demand growth.

Oversupply Fears for 2026

Higher output from OPEC+ and non-OPEC countries, combined with slow demand growth, is creating pressure on prices.

Demand has been especially weak in China and Europe, making it difficult for oil prices to sustain any strong recovery.

Geopolitical Risks Offer Limited Support

Ongoing attacks on Russian energy infrastructure in Ukraine have raised fears of supply disruptions, offering some support to prices. Tensions between the U.S. and Venezuela have also helped limit downside, as stricter enforcement could impact Venezuelan oil exports.

However, these geopolitical risks have not been enough to offset broader concerns about oversupply.

Also Read: Cabinet Approves ₹11,718.24 Crore for Digital Census 2027!

Ukraine Talks and China Data Add Pressure

Hopes of a diplomatic solution to the Ukraine conflict have weighed on oil prices, as a peace deal could eventually bring more Russian oil back into the global market.

At the same time, weak economic data from China has added to demand worries. Industrial output and retail sales missed expectations in November, highlighting ongoing challenges in the world’s largest crude importer.

Conclusion

While oil prices have seen a small bounce after last week’s decline, concerns over excess supply, weak demand from China, and the possibility of more Russian oil returning to the market continue to limit upside in the near term.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.