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Oil Extends Rebound on Supply Risks and U.S. Reserve Buying

Prices are recovering from five-month lows, with a projected 2026 surplus and rising output keeping the outlook cautious.

Overview

  • Brent traded around $61.50–$62.26 and WTI near $57.45–$58.16 early Wednesday, marking a second straight session of gains.
  • Sanctions-related uncertainties and a postponed TrumpPutin summit lifted risk premiums, alongside pressure on Asian purchases of Russian crude and recent refinery disruptions in Russia.
  • The U.S. Department of Energy moved to buy 1 million barrels for the Strategic Petroleum Reserve, and industry data pointed to crude, gasoline and distillate draws last week.
  • U.S.–China engagement steadied sentiment as negotiators convene in Malaysia this week and President Trump signals a potential meeting with President Xi in South Korea next week.
  • The bounce comes against a bearish setup highlighted by the IEA’s roughly 4 million bpd surplus projection for 2026, rising producer output, record crude on tankers and a Brent curve in contango.