World crude oil prices fell to their lowest in five months driven by concerns over global oversupply that continue to weigh on the energy market.
Brent futures closed at around $61 per barrel while West Texas Intermediate (WTI) fell to $57.5 per barrel, marking a continued decline since the beginning of this month.
The decline was driven by expectations of increased production from major producers including OPEC+ and the United States (US) which has the potential to add pressure to the market.
Analysts explained that the current structure of the oil market is showing investors expect supply to outpace demand in the coming period.
A report by the International Energy Agency (IEA) also added to the concern when it predicted that global oversupply could increase by 2026 if demand remains sluggish.
Ongoing trade tensions between the US and China are also expected to have a negative impact on global energy demand and consumption.
At the same time, the increase in the number of active oil rigs in the US and the increase in crude oil stockpiles are also weighing on prices in the market.
Some analysts see the market now entering a bearish phase as investors become more cautious about the medium-term outlook.
While low prices benefit importing countries, they could reduce revenues for the world's major oil producers.
The market is expected to remain volatile in the coming weeks with focus on inventory data and the next OPEC+ policy decision.
