Crude oil prices experienced a decline of 0.26%, settling at Rs 5,053, as market sentiment soured in response to the International Energy Agency’s projection of an expanding supply glut in 2026, coupled with reports of an upcoming meeting between U.S. President Donald Trump and Russian President Vladimir Putin to address the situation in Ukraine. The most recent figures from the U.S. Energy Information Administration indicate a significant increase in crude inventories, which rose by 3.5 million barrels to reach 423.8 million barrels. This surge notably surpasses the anticipated modest build of 288,000 barrels.

The rise was primarily attributed to a decline in refinery utilization, which decreased by 6.7 percentage points to 85.7% as refineries commenced their seasonal maintenance activities. U.S. production has reached an unprecedented level of 13.636 million barrels per day. In the interim, gasoline stocks experienced a reduction of 267,000 barrels, while distillate inventories saw a notable decrease of 4.5 million barrels, indicating a contraction in product supply.

Crude stocks at Cushing, Oklahoma, experienced a reduction of 703,000 barrels, while net U.S. crude imports saw a significant decline of 1.75 million barrels per day. OPEC has upheld its projection for oil demand growth for the years 2025 to 2026, yet it has signaled a reduced supply deficit on the horizon as OPEC+ ramps up its production levels, which raises apprehensions regarding a possible oversupply in the forthcoming year.

From a technical perspective, the market is experiencing long liquidation, evidenced by a significant decline in open interest, which has decreased by 49.37% to 4,622. Crude oil currently finds itself with immediate support at Rs 4,940, and in the event of further weakness, it may test the level of Rs 4,828. On the upside, resistance is observed at Rs 5,210 and Rs 5,368.