Oil prices fell sharply on Wednesday, logging an annual decline of nearly 20% as oversupply fears persisted amid sanctions, conflicts, and rising OPEC+ output throughout 2025.
Brent crude futures closed at $60.85 per barrel on the last trading day of the year, down 48 cents, while US WTI crude fell 53 cents to $57.42 per barrel.
Analysts said the drop reflects the longest three-year losing streak for Brent on record, driven by higher tariffs, geopolitical conflicts, and aggressive oil production from OPEC+ and US shale producers.
Read more : Petrol price slashed by Rs 10.28, diesel by Rs 8.57 for next fortnight
BNP Paribas predicts Brent could dip to $55 per barrel in the first quarter of 2026 before stabilizing around $60, as supply growth normalizes and demand remains largely flat across global markets.
US crude inventories fell slightly last week, but gasoline and distillate stocks rose more than expected, indicating sustained supply pressure despite high seasonal demand, analysts said, suggesting continued volatility in early 2026.
Read more : Oil prices edge higher as oversupply worries ease
Geopolitical tensions, including sanctions on Russia, Iran, and Venezuela, and conflicts in Ukraine and the Middle East, continue to support prices despite oversupply, making market movements unpredictable in the coming months.