# Why Oil Is Tanking: Supply Glut Meets Demand Weakness

**The Quick Version**: WTI crude just dropped to $59.64/barrel (-1.52% on Wednesday), and it's not looking pretty. Here's what's crushing oil prices right now.

# # The Supply Problem

U.S. crude inventories jumped **5.2 million barrels** last week, breaking a 4-week drawdown streak. Cushing, Oklahoma hit a new build of 300k barrels. Meanwhile, OPEC just greenlit a production bump of 137k barrels/day for December—yes, they're adding more oil to a market that's already drowning in it.

Here's the kicker: OPEC's announcement that they're **freezing production hikes until 2026** basically screams "we see oversupply coming." They tried to spin it as seasonal, but traders know better. The IEA's latest report confirms it—global oil oversupply is gonna be *worse* than previously thought.

# # Demand Is Cratering

The 36-day U.S. government shutdown (longest on record) is hammering economic activity. Before that, Trump's tariff wars already had the economy cooling. Weak economy = weaker energy demand = bad news for oil.

Add to that: Gasoline inventories dropped 4.7M barrels, but that's actually a sign of demand softness, not strength. Distillate fell 0.6M barrels. The Fed's also basically done cutting rates (Powell hinted this might be the last cut of 2026), which could tighten financial conditions further.

# # Geopolitical Wildcards

Russia's energy sector just got slapped with heavy sanctions on Rosneft and Lukoil (snap into place Nov 21). China, India, and Turkey are scrambling for alternative oil sources. Ukraine's droning refineries and petrochemical plants in Russia, creating more market chaos. Russia-Ukraine war is now in day 1,350 with no end in sight.

Middle East ceasefire is holding—one less thing to worry about.

**Bottom Line**: You've got classic bearish setup—too much oil, not enough buyers, macro headwinds intensifying. Unless demand suddenly rebounds or OPEC actually cuts production (lol), crude's under pressure.