Crude oil prices experienced a decline of 1.62%, settling at Rs. 8,096. This decrease was influenced by a reduction in geopolitical tensions, as US President Donald Trump suggested he would refrain from further military actions against Iran, responding to requests from regional nations, including Qatar. The resumption of Gulf oil supplies has redirected market focus toward a possible global surplus, with JPMorgan estimating an oversupply of 1.1 million barrels per day in September, expanding to 1.4 million bpd in October. Rising production from major producers is contributing to supply concerns, as OPEC output saw an increase in October, primarily driven by Saudi Arabia, Kuwait, and Iraq.
Meanwhile, US crude production achieved a record level of 14.003 million bpd in the week ending October 30. In October, China’s crude oil imports experienced a recovery, reaching 9.88 million bpd, which represents a month-on-month increase of 9.4%. This figure marks the highest level observed since March. Meanwhile, US crude inventories experienced a decline of 865,000 barrels, reaching a total of 409.8 million barrels, contrary to market expectations which anticipated an increase of 877,000 barrels. Petrol inventories decreased by 222,000 barrels, bringing the total to 209 million barrels. In contrast, distillate stocks experienced a notable decline of 3.6 million barrels, resulting in a total of 99.3 million barrels.
Refinery utilisation rose by 1.7 percentage points to 94.5%, reflecting heightened processing activity. OPEC has revised its 2026 global oil demand growth forecast down to 400,000 bpd from an earlier estimate of 1.4 million bpd at the start of the year. This adjustment represents the sixth consecutive downward revision. However, the organization anticipates that deferred demand will bolster stronger consumption in 2027. The International Energy Agency reported that Russian crude production increased to 8.43 million bpd in September, although it remained below year-ago levels, while refinery disruptions continued to constrain operations.
Speculative net long positions experienced a significant decrease of 14,468 contracts, bringing the total to 85,303 for the week ending November 3. This shift indicates a reduction in bullish positioning. Crude oil is currently experiencing renewed selling pressure, as evidenced by a 5.26% rise in open interest to 9,827 contracts, coupled with a price decline of Rs. 133, suggesting the establishment of new short positions. Support is positioned at Rs. 7,920, with an additional level at Rs. 7,745. Resistance is identified at Rs. 8,215, beyond which prices may approach Rs. 8,330.
