Oil Prices Fall as Strong Dollar and Oversupply Fears Weigh on Market

Oil prices dropped on Tuesday amid a stronger U.S. dollar and concerns about potential oversupply, with Brent crude closing down 0.7% at $64.44 per barrel and WTI falling 0.8% to $60.56. A rising dollar, fueled by doubts over further rate cuts, made oil more expensive for foreign buyers, while a slumping U.S. stock market and ongoing government shutdown added to demand worries. Japan’s manufacturing activity also shrank at its fastest pace in 19 months, highlighting global economic weakness. Meanwhile, OPEC+’s decision to pause output hikes in early 2026 signaled caution over a possible supply glut, even as OPEC production rose by 30,000 bpd in October, according to a Reuters survey. Analysts said the short-lived boost from U.S. sanctions on Russia’s Lukoil and Rosneft is fading ahead of new enforcement deadlines, while traders await fresh U.S. inventory data expected to show higher stockpiles.

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OPEC Output Rises Slightly by 30,000 bpd in October Amid Slower Growth

OPEC’s oil production rose by 30,000 bpd in October to 28.43 million bpd, marking a slower increase than in previous months, according to a Reuters survey. The largest boosts came from Saudi Arabia and Iraq, though declines in Nigeria, Libya, and Venezuela offset part of the gains. Under the OPEC+ agreement, five OPEC members — Algeria, Iraq, Kuwait, Saudi Arabia, and the UAE — were meant to lift output by 86,000 bpd, but actual increases reached 114,000 bpd before accounting for 140,000 bpd in compensation cuts. The smaller rise reflects OPEC+’s caution over potential oversupply and the need for some members to make up for earlier overproduction. Despite differing estimates from sources like the IEA, the survey suggests OPEC members are largely producing near their official quotas.

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Lukoil’s Global Operations Disrupted as U.S. and U.K. Sanctions Take Effect

Russia’s Lukoil, the country’s second-largest oil producer, is facing major disruptions across its international operations following U.S. and U.K. sanctions imposed last month. The sanctions have halted oil loadings in Iraq, disrupted trading in Switzerland, and paralyzed its 1,000-employee Teboil network in Finland, where banks have begun freezing payments ahead of the November 21 wind-down deadline. Iraq’s Somo cancelled three Lukoil crude cargoes—scheduled for November 11, 18, and 26—from the 480,000 barrels-per-day West Qurna-2 field, where Lukoil holds a 75% stake. In Geneva, Lukoil’s trading arm Litasco has been unable to charter ships and has reportedly laid off staff due to Western brokers’ refusals to cooperate. Global trader Gunvor has offered to purchase Lukoil’s foreign assets, with CEO Torbjorn Tornqvist warning that Lukoil’s international operations are “paralysed” and that refinery disruptions and job losses are imminent.

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EU-Sanctioned Tanker Delivers Russian Naphtha to Adani’s Mundra Port Despite Entry Ban

The EU-sanctioned tanker Prometei has discharged 30,000 metric tons (260,000 barrels) of Russian naphtha at Adani Group’s Mundra port in western India, marking the first such case since Adani banned blacklisted vessels from its terminals on September 11. The cargo, loaded from Ust-Luga, Russia, was delivered for HMEL. This incident highlights a potential breach in Adani’s enforcement policy amid tightening Western sanctions on Russian oil and refined products. India has imported an average of 54,000 bpd of Russian naphtha this year, with October shipments reaching 185,000 tons, up from 170,000 tons in September. The case follows an earlier event where Adani denied entry to another tanker, Rose Makis, carrying Nayara Energy’s refined fuels, which was later diverted to Mumbai port.

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Libya Targets 2 Million bpd Oil Output Within Five Years

Libya plans to raise its oil production to 1.6 million bpd in 2026 and 1.8 million bpd in 2027, according to Oil Minister Khalifa Abdulsadek. Speaking at the ADIPEC energy conference in Abu Dhabi, he stated that the long-term goal is to reach 2 million bpd within five years. Current production levels stand at around 1.4 million bpd, indicating a substantial expansion target. The minister emphasized that the output growth is central to Libya’s economic recovery and energy strategy. The announcement highlights Libya’s ambition to strengthen its position in global oil markets despite ongoing political and infrastructural challenges.

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TotalEnergies Sees Oil Demand Growing Until 2040 Amid Slower Energy Transition

French energy giant TotalEnergies now forecasts global oil demand to rise nearly 5% to 108 million bpd by 2040, before gradually declining, citing weak political coordination and renewed emphasis on energy security. The company revised its outlook upward due to U.S. President Donald Trump’s rollback of green subsidies, new LNG licenses, and slower EV adoption globally. Under current trends, oil demand is projected to drop to 98 million bpd by 2050, or to 79 million in a moderate “momentum” scenario, and 55 million under a Paris Agreement-aligned path. CEO Patrick Pouyanne said political fragmentation makes the Paris-aligned scenario “out of reach.” He also noted that China has become the global clean-tech superpower, holding roughly 80% of market share in key future technologies, while global natural gas demand will rise 10% and electricity use will nearly double to 57,140 terawatt hours by 2050, driven by Asia and data centres.

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LG Chem, Sinopec Partner to Develop Sodium-Ion Battery Materials

LG Chem of South Korea and China’s Sinopec Group have formed a partnership to develop cathode and anode materials for sodium-ion batteries, viewed as a promising next-generation energy storage technology. Sodium-ion cells offer advantages such as lower costs, improved safety, and better performance in low temperatures compared to lithium-based batteries. Despite their potential, adoption has been slow as lithium-iron-phosphate battery prices continue to decline. LG Chem’s Vice Chairman Shin Hak-cheol said the collaboration will accelerate the company’s development of next-generation materials. The two firms aim to supply global energy storage and EV markets, with China projected to produce over 90% of the world’s sodium-ion batteries by 2030.

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LNG Freight Rates Surge to Multi-Month Highs Amid Tight Ship Supply and Winter Demand

LNG shipping rates have climbed to multi-month highs, driven by tight vessel availability, Egypt’s delayed cargo discharges, and seasonal winter demand, according to shipping sources. Atlantic LNG freight rates for 174,000-cubic-meter, two-stroke vessels rose to $61,500 per day, the highest since August 2024 and more than 50% above last week’s $39,750, while Pacific rates hit $42,250 per day, their strongest since June. Disruptions from Egypt’s import delays and traders’ efforts to secure tonnage early have squeezed available ships, while rising inventories in Europe and Japan ahead of colder months are adding pressure. Eastbound U.S. LNG shipments—spurred by new export projects like Plaquemines LNG and Corpus Christi Stage 3—have further tightened supply by increasing voyage durations. Analysts expect freight prices to stay firm in the short term, particularly if the JKM-TTF price spread continues to widen and revives U.S.-to-Asia LNG arbitrage.