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Crude prices rose on Thursday as renewed expectations of a US Federal Reserve rate cut and a firmer geopolitical risk premium outweighed fresh signs of global oversupply.

Brent finished 59 cents higher at $63.26 a barrel, up 0.9%, while WTI gained 1.2% to settle at $59.67.

A softer US employment reading strengthened the case for monetary easing, sending the dollar to a tenth consecutive session of losses and improving crude’s appeal to non-US buyers. Analysts said rate-cut optimism shaped early market direction, lending support despite prevailing bearish fundamentals.

Geopolitical developments added to the upside as peace talks between Washington and Moscow again ended without progress, suggesting sanctions on Russian oil are unlikely to be lifted in the near term. Continued Ukrainian drone strikes on refining and pipeline infrastructure reinforced the conflict-related risk premium, with analysts estimating Russian refining throughput down by 335,000 barrels per day (bpd) year on year between September and November.

Tensions surrounding Venezuela also resurfaced after US President Donald Trump signalled potential military action against alleged drug cartels operating inside the country, raising concerns that an escalation could disrupt already fragile Venezuelan exports.

Still, supply-side indicators remained broadly negative. US crude inventories rose by 574,000 bpd last week, contrary to expectations for a draw, while gasoline and distillate stocks posted sizeable builds. The data underscored a comfortable supply backdrop heading into year-end.

Saudi Arabia’s move to reduce its January Arab Light official selling price to Asia to a five-year low of 60 cents above the Oman/Dubai benchmark reinforced the market-share strategy increasingly adopted by major producers. Market insiders downgraded its 2025–2027 oil price assumptions, citing sustained oversupply and stronger-than-expected output growth, added further pressure.

With macroeconomic optimism colliding with a persistent surplus narrative, traders said crude remains confined to a narrow trading band. Brent continues to hover in the mid-$60s as markets weigh geopolitical uncertainty against an expanding supply outlook.

Written by: Aiman Haikal