Oil prices fell on Wednesday as global financial markets faced a broader selloff, raising worries about slowing economic and fuel demand growth. A stronger US dollar and reports of higher US crude inventories added further pressure to the market.
Brent crude futures dropped 36 cents, or 0.56%, to $64.08 a barrel by 0221 GMT. Meanwhile, US West Texas Intermediate (WTI) crude slipped 40 cents, or 0.66%, to $60.16. Both benchmarks continued their losses from the previous session.
The decline in oil came as part of a wider drop in equity markets. Asian shares extended overnight losses from Wall Street, where investors grew cautious about high stock valuations—especially among companies linked to artificial intelligence. The risk-off sentiment pushed the US dollar higher against other major currencies.
A stronger dollar often weighs on oil demand because it makes dollar-priced commodities more expensive for holders of other currencies. According to market analyst Tony Sycamore from IG, crude prices weakened as investors moved toward safe-haven assets like the US dollar.
Adding to the bearish tone, the American Petroleum Institute (API) reported that US crude stockpiles rose by 6.52 million barrels in the week ending October 31. The increase in inventories signaled weaker demand and sufficient supply, further dampening market sentiment.
On the supply side, the Organization of the Petroleum Exporting Countries and its allies (OPEC+) recently agreed to raise output by 137,000 barrels per day in December. The group plans to pause further production increases during the first quarter of 2026. However, analysts at LSEG said the pause is unlikely to support oil prices in November and December.
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OPEC’s total output increased by only 30,000 barrels per day in October, as declines in Nigeria, Libya, and Venezuela offset gains elsewhere. With rising stockpiles and a stronger dollar, oil markets remain under pressure, reflecting broader global economic uncertainty.
