Oil prices steady as OPEC+ opts for modest output increase

Oil prices held steady on Tuesday after OPEC+ announced a smaller-than-expected production increase for November, prompting investors to weigh the decision against expectations of a global supply surplus.

Brent crude futures dipped 15 cents, or 0.23%, to $65.32 a barrel by 07:42 GMT, while U.S. West Texas Intermediate (WTI) crude slipped 17 cents, or 0.28%, to $61.52. Both benchmarks had gained over 1% in the previous session following the OPEC+ decision.

The alliance—which includes the Organization of the Petroleum Exporting Countries, Russia, and other producers—agreed to raise collective output by 137,000 barrels per day starting in November. The smaller increase surprised markets that had expected a more aggressive supply boost, suggesting OPEC+ remains cautious amid forecasts of an oil glut in the fourth quarter and into next year, analysts at ING said.

“Brent dropped around $5 a barrel last week on expectations of a larger output hike, so this mild rebound seems reasonable,” noted Anh Pham, senior analyst at LSEG. “For now, the market appears able to absorb the additional supply, and there’s still no sign of contango at the front of the curve.”

Russian Deputy Prime Minister Alexander Novak said OPEC+ did not discuss further quota increases beyond November. So far this year, the group has raised output targets by more than 2.7 million barrels per day—about 2.5% of global demand.

Geopolitical risks continue to lend support to prices, as the ongoing conflict between Russia and Ukraine disrupts energy markets and adds uncertainty around Russian crude exports.

Adding to supply concerns, Russia’s Kirishi oil refinery halted its main distillation unit after a drone strike and fire on October 4. The plant’s recovery could take roughly a month, according to industry sources.