Oil Prices Fall as OPEC+ Output Hike and Kurdish Exports Stoke Supply Surplus Fears

Oil prices fell on Tuesday as expectations of an OPEC+ production increase and the resumption of crude exports from Iraq’s Kurdistan region via Turkey reinforced market concerns about oversupply.

Brent crude futures for November delivery, expiring Tuesday, dropped 53 cents, or 0.8%, to $67.44 a barrel by 10:26 GMT. U.S. West Texas Intermediate (WTI) crude slid 62 cents, or 1%, to $62.83.

The losses extended Monday’s sharp sell-off, when both Brent and WTI fell more than 3% — their steepest daily drop since August 1.

PVM analyst Tamas Varga said selling pressure intensified after OPEC+ sources signaled another production hike. Three people familiar with the talks said the group — which includes the Organization of the Petroleum Exporting Countries and allies such as Russia — could approve an increase of at least 137,000 barrels per day at its meeting on Sunday.

“Even though (OPEC+) is still within its quota, the market doesn’t like the idea of more oil coming,” said Marex analyst Ed Moya.

Meanwhile, Iraq’s oil ministry confirmed that crude flowed to Turkey on Saturday through a pipeline from the semi-autonomous Kurdish region for the first time in two and a half years, following a breakthrough interim agreement.

Recent weeks have seen the market weigh oversupply and weakening demand concerns against supply risks linked to Ukrainian drone strikes on Russian refineries.

Separately, U.S. President Donald Trump secured Israeli Prime Minister Netanyahu’s support for a U.S.-backed Gaza peace proposal, though Hamas’s position remains unclear.

“In an ideal scenario, a Gaza peace deal would normalize shipping through the Suez Canal, wiping out much of the geopolitical risk premium,” PVM’s Varga noted.

ANZ analysts added in a Tuesday note that bearish sentiment has also been amplified by concerns over a potential U.S. government shutdown, which could dampen demand.