WTI drops near $58.00 on oversupply fears, eyes recovery post-shutdown

• WTI price lost more than 4% in the previous session on oversupply concerns.
• EIA raised its 2025 US Oil output forecast, while IEA softened its outlook on peak Oil demand.
• The Oil price may regain as sentiment improves after the US government shutdown ended.

West Texas Intermediate (WTI) Oil price remains subdued for the second consecutive day, trading around $58.20 during the European hours on Thursday. Crude Oil prices lost more than 4% in the previous session amid rising crude inventories in the United States (US), which reinforced concerns about the global supply glut.

The US Energy Information Administration (EIA) has raised its forecast for domestic Oil production next year, while the International Energy Agency (IEA) has softened its outlook on peak Oil demand, now expecting global consumption to continue rising through 2050. Investors are now awaiting the IEA's monthly report later in the day for potential additional bearish signals.

The Organization of the Petroleum Exporting Countries and its allies, including Russia, collectively known as OPEC+, stated that global Oil supplies are expected to outpace demand in 2026, shifting from the group's earlier forecast of a deficit. OPEC+ noted that supply already exceeded demand in the third quarter.

Reuters quoted Suvro Sarkar of DBS Bank as saying, "Recent price weakness appears to be driven by OPEC's revision of the 2026 supply-demand balance in its monthly report, which indicates the group is now acknowledging the potential for a supply glut in 2026, a departure from its previously bullish outlook."

The Oil price could recover its ground amid improving sentiment after US President Donald Trump signed the funding bill on Thursday, ending the record 43-day government shutdown in US history. The bill requires the Government to resume normal operations and call for direct payment for individuals to purchase healthcare.

The American Petroleum Institute (API) reported on Wednesday that US crude oil inventories rose by 1.3 million barrels in the week ending November 7, falling short of market expectations for a 1.7 million-barrel increase.