Oil plunges 4% amid oversupply concerns

Oil drilling rigs

Oil prices fell at the close of trading today, Nov. 12, amid concerns about oversupply after OPEC predicted in its monthly report that global supply would keep pace with demand next year.

Brent crude futures for January delivery fell 3.76%, or $2.45, to settle at $62.71 a barrel.

West Texas Intermediate (WTI) crude futures for December delivery also declined, dropping 4.18%, or $2.55, to $58.49 a barrel.

The Organization of the Petroleum Exporting Countries (OPEC) said in its monthly report released today that it expects global oil supply to keep pace with demand in 2026.

The organization maintained its forecast for global oil demand growth this year at around 1.3 million barrels per day year-on-year, while holding its forecast for next year's growth at 1.4 million barrels per day.

These expectations negatively affected oil's performance in today's session, but crude oil received support from the International Energy Agency's annual report that forecast oil and gas demand will continue to grow until 2050, after previously predicting it would peak this decade.

Markets are awaiting today's vote in the US House of Representatives on a temporary budget bill approved by Congress yesterday, a move that paves the way for ending the government shutdown and could boost consumer confidence and economic activity in the US.