The Oil prices increased on Thursday following two-week lows due to the market being under pressure by concerns that the market will experience low demand and a global supply surplus.
As of 5:01 GMT, Brent crude inched up 17 cents, or 0.27 percent, to $63.69 a barrel, while U.S. West Texas Intermediate futures gained 18 cents, or 0.30 percent, to $59.78 a barrel.
In a client note, the bank stated that the global oil demand has grown by 850,000 barrels per day this year, a bit less than J.P. Morgan’s previous forecast of 900,000 bpd.
It reported that “high-frequency indicators suggest U.S. oil consumption remains subdued,” stating low travel activity and lower container shipments.
The Energy Information Administration informed that the oil prices continued their losses in the preceding session following the U.S government data that the crude inventories went up to 421.2 million barrels last week, much higher than the expectation that it would be increased by only 603,000 barrels.
International oil prices closed a three-month downward trend in October with growing concerns over potential oversupply, with the Organization of the Petroleum Exporting Countries and its allies increasing production levels, and with continued growth in non-OPEC producers.
OPEC+ announced on the weekend that it will increase production by 137,000 barrels per day in December but will halt any production increase in the first quarter of 2026.
The shift has alleviated minimal market apprehensions, given that the group has already increased production by about 3 million barrels per day in 2025.
However, with strong U.S. production and exports, the spurt has deepened concerns over an international supply overload.
A stronger U.S. dollar has put strain on oil prices, with traders reducing their hopes of a Federal Reserve interest rate cut in December.
Transportation Secretary Sean Duffy said on Wednesday that the U.S. Department of Transportation also declared that it will start to cut flights by up to 10 percent in 40 major airports beginning Friday due to safety reasons connected with the shortage of air traffic controllers.
The action follows the U.S. government shutdown, which is in its 36th day, causing federal operations to be disrupted in the country.
Since the shutdown, about 13,000 air traffic controllers and 50,000 Transportation Security Administration employees have been working without pay.
The long shutdown has already caused tens of thousands of flight delays and large-scale congestion at major airports because of staffing shortages.
The flight reductions that are planned would further strain the fuel demand in the largest economy in the world since the impasse in Washington is unlikely to end.
