Oil Extends Decline On Glut Outlook And Push To End War In Gaza

Oil fell for a second session as the market weighed a looming glut and the possibility for an end to hostilities in Gaza, which could siphon some of the war premium out of prices.

Brent dropped below $68 a barrel after tumbling 3.1% on Monday, the biggest decline in nearly two months. West Texas Intermediate traded near $63. The OPEC+ alliance meets on Sunday and is likely to agree on raising output in November, though at a modest rate similar to that for October.

The US and Israel, meanwhile, agreed to a 20-point plan to end the war in Gaza, but the prospects for peace remained unclear without the direct involvement of Hamas. President Donald Trump said the framework had the support of other leaders in the Middle East.

Oil has pulled back from last week’s highs, when traders covered long positions ahead of the weekend to hedge against mounting threats to Russian energy infrastructure by Ukraine. Futures are on track for a modest monthly loss.

The return of idled barrels from the Organization of the Petroleum Exporting Countries and its allies, and supply from producers outside of the group is expected to lead to a record glut next year, according to the International Energy Agency. Some market watchers see Brent falling to the $50s-a-barrel range.

Prices:

• Brent for November settlement, which expires on Tuesday, fell 0.7% to $67.52 a barrel at 8:37 a.m. in Singapore.

  • The more-active December contract slid 0.6% to $66.67 a barrel.

• WTI for November delivery dropped 0.6% to $63.07 a barrel.