Oil steadied to end the week, with OPEC+ expected to focus on another modest output increase when key members convene this weekend and as US President Donald Trump denied that he was planning a military strike on Venezuela.
West Texas Intermediate climbed about 0.7% to settle at $60.98, little changed from the previous week. A third monthly output increase of 137,000 barrels a day would be the base case for Sunday talks among the Organization of the Petroleum Exporting Countries and its allies, delegates said earlier this week, matching market expectations.
Oil prices were up earlier in the session on reports that the US plans to perform military strikes on targets in Venezuela that include military facilities used to smuggle drugs, according to the Wall Street Journal and the Miami Herald, citing US officials and people familiar with the matter. Trump later denied the report, and contradicted his own past statements that he was preparing land attacks after a series of boat strikes, causing futures to ease.
Traders had mostly priced in the prospect of curtailed flows from OPEC member Caracas after Trump deployed naval assets to the Caribbean this year, saying Venezuelan President Nicolas Maduro is an illegitimate leader who is facilitating trafficking. It’s unlikely that a military campaign would target energy assets, market participants say.
The escalation is happening against a backdrop of a looming worldwide crude glut.
“If the US intention is regime change, there is a vested interest in keeping energy infrastructure more or less intact, as that would provide financial support for whatever government succeeds Maduro,” said Gregory Brew, a geopolitical analyst at the Eurasia Group.
Meanwhile, traders continue to assess the potential impact of US sanctions on Russia’s two largest oil producers — something that the boss of Europe’s largest oil refiner said the market was under-appreciating. Processors accounting for more than half of India’s imports of Russian crude have paused buying for the coming months.
WTI crude has fallen more than 10% this year as increased supply from both within and outside OPEC+ outstrips demand growth. The cartel’s upcoming meeting comes at a crucial time. OPEC+ has already restored one tranche of curbed supplies, amounting to 2.2 million barrels a day, a year ahead of schedule. The group has adopted a more careful pace with the subsequent layer of additions, waiting to see how the market develops.
While crude markets are wrestling with oversupply, there’s been strength in refined fuels, particularly after US sanctions on Russian producers Rosneft and Lukoil. Diesel prices are at their biggest premiums to crude since early 2024, bolstering refining margins, which can in turn boost demand for crude.
Oil Prices
WTI for December delivery rose 0.7% to settle at $60.98 a barrel in New York.
Brent for January settlement edged 0.6% higher to settle at at $64.77 a barrel.
The December contract expires Friday
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