Crude oil markets whipsawed this week as a sharp recovery in OPEC+ production collided with lingering Middle East shipping risks and tentative signals of US-Iran diplomacy. Brent futures initially climbed 1.7% to $93.08 a barrel on Wednesday, while West Texas Intermediate advanced 1.4% to $87.23, before both benchmarks slipped on Thursday to about $92 and $86 respectively.
The Organization of the Petroleum Exporting Countries reported that total production across the group and its allies reached 41.23 million barrels per day in October, an increase of 2.04 million from September. Saudi Arabia led the rebound, telling OPEC its output rose 26% to 10.56 million barrels per day, one of its highest levels in years. Iraq also increased output substantially as producers restored volumes disrupted by the conflict with Iran.
OPEC kept its global demand growth forecast at 200,000 barrels per day for this year and around 2.6 million for next year. Its projected call on alliance crude remained at 42.1 million barrels per day in 2026 and 43.9 million in 2027.
However, traders remain focused on whether additional production can reach consumers. Tanker insurance costs, disrupted logistics and security risks in the Strait of Hormuz continue to complicate deliveries. The International Maritime Organization said it had verified more than 130 attacks on commercial vessels in the strait since the war began on February 28, with at least 25 seafarers killed. Hormuz carried roughly a fifth of the world’s oil and liquefied natural gas flows before the conflict.
Diplomatic developments added another layer of uncertainty. The Wall Street Journal reported that Vice President JD Vance is considering direct talks with Iranian security official Mohsen Rezaei, though discussions remain preliminary. Rezaei said Iran would not allow enriched nuclear material to leave the country, raising doubts about prospects for a swift agreement with Washington. President Donald Trump has said he does not believe more strikes on Iran will be needed.
On the supply side, the American Petroleum Institute estimated US crude inventories rose by roughly 9 million barrels in the week ended November 6. Official figures from the US Energy Information Administration are due Thursday, delayed by Veterans Day, and the International Energy Agency will publish its monthly report on Friday.
The EIA expects Brent spot prices to average around $100 during November and December if regional supply constraints persist, but forecasts prices falling toward $77 in the final quarter of 2027 as production recovers and inventories rebuild. OCBC kept its year-end Brent forecast at $100 a barrel, while ING noted regional crude flows are approaching pre-war levels but warned that volatility should remain high because exports still rely on routes around Hormuz.
