Oil prices dipped on Wednesday amid a wider slump in financial markets and a strong U.S. dollar, while investors assessed the supply outlook.
Brent crude futures edged lower by 6 cents, or 0.1%, to $64.38 a barrel by 0408 GMT, having touched a near two-week low in the prior session. U.S. West Texas Intermediate crude was down 10 cents, or 0.17%, at $60.46.
The risk-off tone across markets saw investors exit energy markets, ANZ analysts wrote in a Wednesday client note.
Asian stocks dived on Wednesday and market volatility reached levels not seen since April after an overnight tech-led selloff on Wall Street put the spotlight on stretched valuations.
The U.S. dollar index – which measures the currency against the euro and sterling, along with the yen and three other peers – was steady at a three-month high, buoyed by division among the Federal Reserve board, indicating low odds for an interest rate cut at the next policy meeting in December.
A stronger greenback makes dollar-denominated oil more expensive for holders of other currencies, which can impact demand. A U.S. interest rate cut typically boosts demand.
“Crude oil is trading lower… as risk sentiment shifted sharply negative, boosting the safe haven U.S. dollar, both of which weighed on the crude oil price,” IG market analyst Tony Sycamore said in a note.
Prices were also under pressure as the American Petroleum Institute said U.S. crude stockpiles rose in the week ended October 31, sources said citing the API figures on Tuesday.
Supply-side concern continued to weigh on prices. The Organization of Petroleum Exporting Countries and allied producers, known as OPEC+, agreed on Sunday to increase output by 137,000 barrels per day in December.
The group decided to pause further increases in the first quarter of 2026. However, the pause was “unlikely to offer meaningful support to November and December prices,” LSEG analysts said in a note.
OPEC itself only added 30,000 bpd to its output in October versus 330,000 bpd in month prior as previously agreed OPEC+ increases were offset by declines in Nigeria, Libya and Venezuela.
(Reporting by Colleen Howe in Beijing and Siyi Liu in Singapore; Editing by Christian Schmollinger and Christopher Cushing)