OPEC+ Pauses Output Increases Amid Global Oil Oversupply Concerns

Oil prices edged lower as OPEC+ decided to modestly increase output in December but pause further production hikes in the first quarter of 2026, signaling concerns about a potential oversupply amid rising global supply. Brent crude futures fell slightly to about $64.74 a barrel, and U.S. West Texas Intermediate crude dropped to near $60.91 a barrel, reflecting investor caution over the market's balance. This pause, influenced partly by Russia's lobbying due to export constraints from Western sanctions, marks a shift from OPEC+'s previously bullish stance on demand absorption. Industry experts remain divided, with some European energy leaders and U.S. officials disputing the oversupply narrative, citing sustained demand and easing production pressures. Geopolitical risks, including sanctions on major Russian oil companies and attacks on energy infrastructure, continue to provide some price support despite oversupply fears. Analysts warn the market could face a supply glut by 2026 if demand growth falters, potentially prompting OPEC+ to reconsider output policies or leading to reduced U.S. shale production.