07-Jan-2026 13:11

Oil prices extended losses after Washington and Caracas struck a deal to redirect Venezuelan oil ' originally destined for China ' to U.S. refiners, a move that could soften market tightness. President Trump said the agreement, potentially worth up to $2 billion, aims to support Venezuelan production while diverting shipments from Asian buyers. WTI oil futures slipped nearly 2%, falling below $56 per barrel. Meanwhile, on the domestic front, MCX January crude futures also weakened sharply, trading more than 2.5% lower around ₹5078 per barrel. Oil benchmarks have been pressured by expectations of ample global oil supply in 2026, with some forecasts pointing to continued surplus conditions. At the same time, progress toward a U.S.'Ukraine security agreement has raised the possibility of fewer restrictions on Russian crude exports, adding to the bearish sentiment. API figures showed U.S. crude inventories unexpectedly fell by about 2.8 million barrels last week, yet price weakness persists amid broader oversupply concerns.

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