Oil prices search for direction; oversupply jitters persist

Investing.com -- Oil prices edged marginally higher Tuesday, struggling for direction as traders digested the likely reopening of the U.S. government as well as a looming supply glut.

At 05:20 ET (10:20 GMT), Brent oil futures for January gained 0.3% to $64.28 a barrel, while West Texas Intermediate crude futures rose 0.3% to $60.29 a barrel. 

Crude looks to end of U.S. shutdown 

Both benchmarks edged higher in the previous session, and have continued to firm Tuesday with the longest government shutdown in U.S. history likely to end this week after the Senate approved a compromise that would restore federal funding.

The deal now goes to the House of Representatives, where Speaker Mike Johnson has said he would like to pass it as soon as Wednesday, before heading to President Donald Trump for his signature.

The shutdown has been a major point of anxiety for oil markets, especially as it disrupted air travel across the world’s largest fuel consumer. 

The Federal Aviation Administration said late last week airlines must cut 4% of domestic flights starting on Friday daily through Monday, then ramping up to a full 10% cut by November 14.

Oversupply fears remain 

However, while oil prices were trading off recent lows, they were still nursing losses so far in 2025, on concerns over a supply glut and weakening global demand.

Oversupply fears stem chiefly from a slew of production increases by the Organization of Petroleum Exporting Countries and allies, known as OPEC+,this year. 

The cartel agreed to raise oil output in December by 137,000 barrels per day, the same amount as the previous two months, and then to pause the output hikes for the first quarter of 2026.

Ukraine-Russia strikes in focus

Traders will also be keeping an eye on the conflict in Ukraine as he has the potential to seriously impact supply from Russia.

Ukraine over the weekend launched drone attacks against more of Russia’s energy infrastructure, prompting retaliatory strikes by Moscow. 

The war– which entered its third year in 2025– showed few signs of easing, especially as U.S. attempts to broker a ceasefire fell flat.

The conflict has offered some support to oil prices, especially as Ukrainian strikes disrupted Russian energy production, while the U.S. attempted to coerce Moscow into a ceasefire with more sanctions on its oil industry. 

Ambar Warrick contributed to this article