Oil News: Oil Demand Concerns and OPEC Output Plans Drive Bearish Crude Oil Outlook

Oil Market Weekly Recap: OPEC+ Debate and Weak Data Sink Crude

Crude oil futures ended the week under heavy pressure as traders priced in a potential OPEC+ supply boost alongside softer U.S. economic data and rising inventories. West Texas Intermediate (WTI) closed at $61.87, down more than 3% on the week, and importantly, finished on the weak side of the 52-week moving average at $63.40. This breakdown leaves $61.12 as the next key support level on the weekly chart.

OPEC+ Considers Accelerating Supply Increases

The primary driver was mounting expectation that OPEC+ will vote to restore an additional 1.65 million barrels per day of production at its September 7 meeting. This increase—roughly 1.6% of global demand—would unwind a second layer of cuts much earlier than planned, following the 2.2 million bpd increase already phased in this year. Analysts view the move as a clear signal that producers, particularly in the Middle East, are prioritizing market share over price stability. Traders responded by marking prices lower ahead of the weekend meeting.

U.S. Inventories Surprise to the Upside

Bearish pressure intensified after the EIA reported a 2.4 million barrel build in crude inventories, defying expectations for a draw. Refinery maintenance and narrower margins suggest throughput could soften further into September. Combined with U.S. production holding steady at record highs above 13.5 million barrels per day, the inventory data reinforced the perception that the supply side of the market is well covered, undermining any bullish narrative around tightness.

Weak U.S. Data Darkens Demand Outlook

The demand side offered no relief. U.S. payrolls grew by just 22,000 in August versus forecasts for 75,000, while job openings dropped to their lowest level in ten months. Manufacturing contracted for a sixth straight month, underscoring weakness in industrial fuel consumption. While the Federal Reserve is expected to cut rates at its September meeting, traders doubt easier monetary policy will deliver a meaningful boost to energy demand in the near term.

Geopolitical Risks Take a Back Seat

Although Ukraine’s drone campaign has disrupted some Russian refining capacity, crude export flows remain intact. As a result, geopolitical risks are being discounted compared to the more immediate drivers of OPEC+ supply policy, U.S. stock builds, and weakening demand signals.

Oil Prices Forecast: Bearish Into Next Week

With WTI closing below the 52-week moving average at $63.40 and pressing against support at $61.12, the outlook for the week ahead is bearish. Unless OPEC+ surprises the market by holding production steady, additional barrels will likely weigh further on sentiment. A decisive break below $61.12 would expose the $56.09 level, while resistance at $66.03 caps the upside. Rallies are expected to attract selling interest until fundamentals shift in a more supportive direction.

More Information in our Economic Calendar.