Oil prices staged a rebound today, recovering from their recent five-month lows.
The market reacted positively to the news that the US Department of Energy is seeking to purchase approximately 1 million barrels for the Strategic Petroleum Reserve (SPR).
Additionally, the potential for a US-India deal that may cut Russian flows and tighten the market lifted prices.
Hopes regarding US-China trade improvement could support demand expectations and help improve the outlook.
However, the market could face a persistent global supply surplus, driven by record-high US production and OPEC+’s commitment to planned output increases. These factors, combined with forecasts from major agencies pointing to continued inventory builds and slower global demand growth, could cap significant price gains.
Near-term, the market’s direction could be influenced by the EIA Weekly Petroleum Status Report. A change in the forecasted supply-demand equilibrium or a strong draw could support the rebound in oil prices.
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