Crude oil prices have held steady in Wednesday trading as markets absorbed a mix of bearish U.S. inventory data and anticipation of a fresh output hike from the OPEC+ alliance.

The week’s developments suggest a pivot in market dynamics, with attention shifting from geopolitical tension to supply-demand fundamentals and monetary policy signals.

At the time of writing, Brent crude was trading at $67.13 per barrel, while West Texas Intermediate (WTI) stood at $65.47, both reflecting modest increases from their opening levels in the Asian market.

The latest data from the American Petroleum Institute (API) showed an unexpected crude oil inventory build of 680,000 barrels for the last full week of June.

This surprise came after five consecutive weeks of stockpile draws totaling over 22 million barrels, prompting traders to reassess short-term demand expectations in the world’s largest oil-consuming economy.

The API data “broke the momentum built from consistent inventory draws,” said commodities strategist Aaron Mendez.

“While the build isn’t massive, it reintroduces some demand-side doubts at a time when supply is also expected to increase.”
Aaron Mendez, Commodities Strategist

OPEC+ to Expand Supply by 411,000 bpd

The oil market is also closely watching OPEC+ ahead of its highly anticipated meeting at the end of this week. According to analysts, the group is likely to announce a further 411,000 barrels per day (bpd) supply increase as part of its phased reversal of earlier production cuts.

“Today’s oil price moves are being pushed by the interplay of potentially rising OPEC+ supply, confusing U.S. inventory signals, uncertain geopolitical outlook, and macro-policy ambiguity.”
Priyanka Sachdeva, analyst at Phillip Nova

OPEC+ had originally planned to gradually restore 2.2 million bpd of cuts over a period extending to the end of 2026.

However, the group is now expected to bring all withheld barrels back by the close of Q3 2025, signaling confidence in the global demand outlook and a strategic shift to protect market share.

According to ING commodity analysts Warren Patterson and Ewa Manthey, this move could push the market into surplus:

“These larger supply increases should leave the global oil market well supplied for the remainder of the year.
“It’s set to return to a large surplus in the fourth quarter.”
Warren Patterson and Ewa Manthey

The ING commodity analysts also pointed to the OPEC spare capacity cushion as a factor calming market nerves.

“Expectations for a comfortable oil balance, along with a large amount of OPEC spare production capacity, appear to be comforting the market.”
Warren Patterson and Ewa Manthey

Geopolitical Risk Premium Fades

Another key driver tempering price volatility has been the apparent cooling of tensions between Israel and Iran, following the recent ceasefire.

The previously high-risk geopolitical environment had added a so-called “war premium” to prices in recent months.

Sachdeva noted, “With the war premium gone after the ceasefire between Israel and Iran, only the weaker U.S. dollar is currently exerting upward pressure on oil prices,” indicating that fundamentals are reclaiming their influence.

Going into the second half of 2025, the outlook for oil remains fluid. While increased OPEC+ production and signs of economic resilience in major markets support price stability, lingering uncertainties remain.

Central banks’ interest rate trajectories, global economic sentiment, and China’s demand recovery will be critical in shaping crude price movements in the coming quarters.

As of now, the oil market appears to be entering a phase of measured optimism, bolstered by a clearer OPEC+ strategy, receding geopolitical risks, and strong spare production capacity.

Yet, with U.S. inventories sending mixed signals and macroeconomic policy still in flux, volatility may not be entirely off the table.