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Investing.com-- Oil prices steadied Wednesday, but remained under pressure from heightened U.S.-China trade tensions as well as the International Energy Agency’s warning of a looming supply glut.
At 05:30 ET (09:30 GMT), Brent oil futures for December fell 0.1% to $62.36 a barrel and West Texas Intermediate crude futures gained 0.1% to $58.74 a barrel.
Both contracts closed at five-month lows in the previous trading session after the U.S.’s threat of more trade tariffs on China, sparking fears of a renewed trade war, which could hurt oil demand.
Weak inflation data from China added to oil’s woes, amid signs of continued economic weakness in the world’s largest oil importer.
IEA warns of supply surplus in 2026
Additionally, the IEA said in a monthly report on Tuesday that the global oil market could see a supply overshoot of as much as 4 million barrels, a bigger surplus than it had previously forecast.
The IEA cited rising oil production, especially in the Organization of Petroleum Exporting Countries, and sluggish demand as the key drivers of the expected surplus. The agency also trimmed its oil demand growth estimate for 2025 and 2026.
The IEA report was in sharp contrast to a monthly report from the OPEC released earlier this week, which forecast demand would rise by at least 100% more than the IEA’s outlook.
The OPEC has steadily increased its production this year, as the cartel wound back two years of production cuts to gain a greater market share.
U.S. inventory data due
The crude market had been hit last week after the trade dispute between the United States and China, the world’s two largest oil consumers, intensified after China last week announced a major expansion of rare earth export controls and U.S. President Donald Trump threatened to raise tariffs on Chinese goods to 100% and tighten software export curbs from November 1.
Traders will also be awaiting weekly inventory data from the U.S., with crude oil stockpiles expected to have risen last week, while gasoline and distillate inventories likely fell.
Ambar Warrick contributed to this article