Oil prices fall as oversupply concerns overshadow US government reopening

Oil prices fell more than $2 on Wednesday, weighed down by an OPEC report saying global oil supply will match demand in 2026, marking a further shift from its earlier projections of a supply deficit.

Brent crude futures fell $2.15, or 3.3%, to $63.01 a barrel by 10:11 a.m. CST (1611 GMT) after gaining 1.7% on Tuesday. U.S. West Texas Intermediate crude was down $2.07, or 3.39%, at $58.97 a barrel, after climbing 1.5% in the previous session.

The Organization of the Petroleum Exporting Countries noted that world oil supply would match demand next year due to the wider OPEC+ group's production increases - a shift from its earlier projections of a supply deficit in 2026.

"The prospect that the market is in balance is definitely what drove down prices," said Phil Flynn, senior analyst with Price Futures Group. "I think the market wants to believe it's balanced. I think the market took OPEC more seriously than IEA."

The International Energy Agency, meanwhile, forecast in its annual World Energy Outlook on Wednesday that oil and gas demand could continue to grow until 2050.