Crude Oil: Oversupply Outlook Further Strengthens

■ International organizations further reinforce their view that global crude oil supply and demand are moving toward oversupply. 

■ With crude oil supply remaining ample and little likelihood of tightening, upward pressure on WTI prices may be limited. 

As of August, international organizations released their outlooks for global crude oil supply and demand. Regarding global demand growth in 2025, the U.S. Energy Information Administration (EIA) revised its forecast for daily crude oil demand to 980,000 barrels per day (from 102.74 million barrels in 2024 to 103.72 million in 2025), an increase of 800,000 barrels from last month, citing upward revisions for demand in the U.S. and China. The Organization of the Petroleum Exporting Countries (OPEC) maintained its original forecast of a 1.29 million barrels per day increase (from 103.84 million in 2024 to 105.13 million in 2025). Meanwhile, the International Energy Agency (IEA) noted that the impact of US tariffs has depressed demand in major countries, leading to a slight downward revision of its global crude oil production forecast to 680,000 barrels per day (from 103.0 million in 2024 to 103.68 million in 2025), a small decrease from the previous month's 700,000-barrel increase.  
 

To restore their crude oil supply share and maintain market pricing power, some OPEC+ members decided on September 3rd to increase production by 547,000 barrels per day, ending their voluntary cuts of 2.2 million barrels per day, originally scheduled for September 2025, a year early. This significantly alters the supply outlook. The EIA raised its forecast for global crude oil supply growth in 2025 to 2.28 million barrels per day (from 103.08 million in 2024 to 105.36 million in 2025), a notable increase from last month's 1.81-million-barrel rise. The IEA also upgraded its forecast to 2.5 million barrels per day (from 103 million in 2024 to 105.5 million in 2025), an increase of 2.1 million barrels from last month. Consequently, the supply surplus in 2025 is expected to widen further. 
 

    OPEC+ has been maintaining production cuts through three mechanisms. Besides the voluntary cuts, which ended in September, two other cuts remain: a voluntary reduction of 1.66 million barrels per day and a coordinated cut of 2 million barrels per day, both set to last until the end of 2026. Additionally, two major US oil producers reported record daily crude oil output in their Q2 earnings, demonstrating their commitment to shale oil development. Given these factors, crude oil supply remains sluggish, and the global supply and demand environment is unlikely to tighten. Future demand trends will fluctuate in line with the pace of the global slowdown, while on the supply side, vigilance over OPEC+ production cuts remains crucial. WTI crude oil futures are likely to see limited upward pressure.