Oil prices edged down on the final trading day of 2025 on Wednesday as a stronger US dollar weighed on demand and expectations of ample supply continued to pressure the market.
International benchmark Brent crude traded at $61.20 per barrel at 9.55 a.m. local time (0655 GMT), down 0.1% from the previous close of $61.27.
US benchmark West Texas Intermediate (WTI) also decreased by 0.1% to $57.77, compared to $57.83 in the prior session.
The rise of the US dollar against other currencies was effective in the decline in oil prices. The US dollar index increased by 0.06% to 98.017. The strong dollar is expected to reduce demand by making oil more expensive for foreign currency users.
Prices also fell as markets continued to factor in OPEC+ plans to gradually unwind production cuts that had supported the market in recent years. Strong output from non-OPEC producers and weaker-than-expected global demand growth added to the downward pressure.
Markets are now focused on an online OPEC+ meeting on Jan. 4, where producers are expected to assess market conditions and discuss production policy for the first half of 2026.
Geopolitical developments at times pushed oil prices higher during the year, though the impact was limited. Attacks on Russian energy infrastructure in Ukraine raised the risk of supply disruptions, with strikes on pipelines and refineries in particular heightening concerns over the supply chain.
The Israel-Hamas war and rising tensions between the US and Iran also heightened risk perceptions around production and shipping routes in the Middle East. Concerns over the security of energy flows through the Strait of Hormuz triggered brief price gains but failed to shift broader market sentiment.
Diplomatic tensions between Washington and Caracas also fueled uncertainty over the durability of Venezuela's oil exports, with markets watching the risk of sanctions being reimposed. Still, expectations of a supply surplus and elevated inventories outweighed those supportive factors.
Analysts say ample global supply, strong production and rising inventories are likely to keep downward pressure on oil prices despite ongoing geopolitical risks.
By Handan Kazanci
Anadolu Agency
energy@aa.com.tr
