Oil markets found a footing on Friday, with Brent crude futures hovering around $68 per barrel and West Texas Intermediate (WTI) near $63, following a sharp decline in the previous session. The steadier tone emerged after a cooler-than-expected U.S. inflation report eased concerns about aggressive monetary policy tightening, providing some support for risk assets.
The International Energy Agency (IEA) revised its 2026 global oil demand forecast downward, citing economic uncertainties and the impact of higher prices. Concurrently, U.S. crude inventories surged by 8.5 million barrels last week, significantly above analyst expectations, highlighting a well-supplied market.
Attention is now squarely on the upcoming OPEC+ meeting scheduled for March 1. According to sources familiar with the discussions, the producer alliance, which includes Saudi Arabia and Russia, is considering resuming gradual output increases starting in April. The group had paused its planned production hikes for the first quarter of 2026.
"The market is balancing between a softer macroeconomic backdrop and the prospect of additional supply," noted a senior trading executive. He pointed to a persistent $5-$7 per barrel geopolitical risk premium embedded in prices.
Further influencing the supply landscape, the U.S. administration issued licenses easing sanctions on Venezuela's energy sector, allowing several major oil companies to operate projects in the country. This could eventually bring more barrels to the global market.
While immediate geopolitical tensions have eased from the forefront, traders remain vigilant. Developments in negotiations with Iran, the situation in Ukraine, and the potential return of Venezuelan exports are all factors poised to influence price direction in the coming weeks leading up to the key OPEC+ gathering.
