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Crude price crumbles Oil futures crater as OPEC projects production to catch demand in 2026
Steve Sutherlin for Petroleum News
Crude oil futures cratered Nov. 12 as the Organization of the Petroleum Exporting Countries raised its production forecast while keeping its demand forecast unchanged, erasing its earlier projections of a supply deficit in 2026.
West Texas Intermediate crude plummeted $2.55, or 4.18%, to close at $58.49 per barrel. Brent fell $2.45, or 3.76%, to close at $62.71.
The Alaska North Slope crude price for Nov. 12 had not yet been released by the Alaska Department of Revenue as Petroleum News went to press early morning Nov. 13. On Nov. 11, ANS closed at a $5.14 premium over WTI, and at a $1.02 premium over Brent.
The Nov. 12 losses unwound a price rally spurred by the reopening of the U.S. government. The jump was part of a multi-day market reaction to the advance of U.S. legislation designed to end a record government shutdown -- which arose from the failure of Congress to agree upon a budget.
In early Asian trading Nov. 13, WTI and Brent were each priced above their Nov. 12 closing prices, after news broke that President Trump had signed a budget bill to end the shutdown.
ANS added a half dollar Nov. 11 to close at $66.18 per barrel, as WTI vaulted 91 cents to close at $61.04, and Brent leapt $1.10 to close at $65.16.
The budget measure passed in the Senate Nov. 10, leading ANS to close 32 cents higher at $65.67. WTI rose 38 cents on the day to close at $60.13, and Brent lifted 43 cents to close at $64.06.
Traders bet that increased liquidity in the financial system resulting from the restoration of government payments would stimulate business and consumer spending -- bullish for oil consumption.
Despite its gains, ANS had made no progress over a trading week from its close Nov. 4 of $66.18, to the exact same close of $66.18 on Nov. 11.
In trading Nov. 7, crude was also higher. ANS rose 16 cents to close at $65.35, WTI rose 32 cents to close at $59.75, and Brent rose 25 cents to close at $63.63.
ANS edged 7 cents lower Nov. 6 to close at $65.20, while WTI fell 17 cents to close at $59.43, and Brent fell 14 cents to close at $63.38.
On Nov. 5, ANS dropped 91 cents to close at $65.27, WTI dropped 96 cents to close at $59.60, and Brent dropped 92 cents to close at $63.52.
OPEC call adds to oversupply worries OPEC's less bullish crude market forecast comes as some crude sellers struggle to find buyers, according to John Kilduff, partner at Again Capital.
"There are cargoes going begging," Kilduff said told Reuters Nov 12. "The very front of the market is forming a new price curve. There's just a general sense of weakness in the U.S. economy."
OPEC called for global oil demand to grow by 1.3 million bpd in 2025 and by 1.38 million bpd in 2026 as the global economy maintains steady growth.
The cartel now sees supply exceeding demand by 500,000 bpd in third quarter 2025 based on its rising estimates for total U.S. liquids production in the period. It had previously called for a supply deficit of 400,000 bpd.
Long term, OPEC sees global energy demand expanding by 23% to 2050, driven by expanding economic growth, rising populations, increasing urbanization, new energy-intensive industries like artificial intelligence, and the need to bring energy to the billions without it.
The history of energy is one of additions, not subtractions, OPEC Secretary General Haitham Al Ghais said in a forward to the group's 2025 World Oil Outlook.
Al Ghais said the combined percentage of oil, gas and coal in the energy mix was some 80% in 2024, slightly less than when OPEC was founded in 1960, while energy consumption jumped more than five-fold over that period.
"Oil underpins the global economy and is central to our daily lives," Al Ghais said. "Out to 2050, we see oil demand continuing to expand and reaching 123 million barrels a day. There is no peak oil demand on the horizon."
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