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West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $64.00 during the early European trading hours on Friday. The WTI price falls after hitting its highest since late September as oversupply concerns weigh on the price. 

Crude oil global production exceeded consumption throughout 2025, leading to significant stockpile builds. This, in turn, weighs on the black gold price. The International Energy Agency (IEA) estimated a substantial surplus will continue through 2026, with an average oversupply of more than 3.7 million barrels per day (bpd) for the year.

Furthermore, a renewed US Dollar (USD) demand could undermine the USD-denominated commodity price. The Greenback rebounds after a report that Trump and Senate Democrats struck a deal to avoid a US government shutdown. The US Senate could vote as soon as Thursday night to approve a government funding package after Democrats reached a deal with Trump to strip out the full-year spending bill for the Department of Homeland Security (DHS).

On the other hand, the potential downside for the WTI might be limited after US President Donald Trump warned Iran to make a nuclear deal or face military strikes. Trump stated on Wednesday that US ships he ordered to the region were ready to fulfill their mission “with speed and violence, if necessary.” 

Iran responded with a threat to strike back against the US, Israel, and those who support them. Heightened geopolitical risk in Iran, OPEC’s fourth-largest crude oil producer at 3.2 million bpd, could boost the WTI price in the near term. 

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