Oil prices remain under pressure amid supply glut outlook; U.S. CPI data in focus.

Oil prices were mostly stable in Asian trading on Friday but remained on course for a weekly loss after plunging nearly 3% in the prior session, as expectations of a substantial supply surplus and rising inventories pressured sentiment. By 21:07 ET (02:07 GMT), Brent crude for April delivery was up 0.1% at $67.56 a barrel, while WTI crude also edged 0.1% higher to $62.87. Both benchmarks had dropped close to 3% previously, leaving them down about 1% for the week.

IEA projects oil supply surplus and weaker demand growth outlook.

The International Energy Agency, in its latest monthly report, projected that the global oil market could see a surplus exceeding 3.7 million barrels per day in 2026, pointing to a pronounced supply overhang.

It also noted that global stockpiles grew last year at one of the fastest paces since the pandemic, reflecting comfortable supply levels. The agency lowered its forecast for global demand growth, citing a softer economic outlook and moderating consumption, even as non-OPEC production stays strong. This combination of weaker demand and resilient output has intensified concerns about prolonged oversupply.

In the U.S., the Energy Information Administration reported an 8.53 million-barrel increase in crude inventories this week—well above expectations and the largest build since January 2025—indicating sluggish refinery demand and abundant supply.

U.S.- Iran nuclear talks under scrutiny; U.S. CPI data awaited.

Meanwhile, investors monitored geopolitical developments after Donald Trump said negotiations over a potential U.S.-Iran nuclear deal could last up to a month.

The possibility of extended talks eased immediate fears of supply disruptions in the Middle East, reducing the geopolitical premium that had previously supported prices. Attention is also turning to U.S. CPI data due later Friday, which may provide further insight into the Federal Reserve’s rate outlook after strong January employment figures dampened hopes for near-term rate cuts.

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