Brent crude gains as oil supply surplus beats record in 2026

Brent crude is on track to end the week in the red, caught between a rock and a hard place. On the one hand, fears of a record 2026 oil surplus continue to cast a long shadow over prices. On the other one, escalating geopolitical friction is providing short-term support to the market. Quotes clawed back some ground on Friday following news that the United States (US) is preparing to intercept more Venezuelan tankers—a move that poured fuel on the fire of immediate supply concerns.

Adding a silver lining, the International Energy Agency’s (IEA) December report gave investors a boost. For the first time since May, the organization trimmed its estimate of the looming surplus by raising demand growth forecasts and dialing back supply projections. This turnaround—fueled by an improving macroeconomic outlook and export curbs in Russia and Venezuela—helped ease the bearish gloom from recent months and injected fresh optimism into trading.

Not to be outdone, OPEC is also painting a rosier picture for the coming year, waiting for global oil supply and demand to be nearly neck-and-neck in 2026. This stark divide between major forecasters suggests worries of a saturated market may have been overplayed.

Underpinning it all, physical demand continues to hold its ground, confirming there is still fire beneath the smoke. Predictions that the number of Chinese refineries running for fuel will plateau by 2030 support a steadier narrative and undercut the most dire scenarios. Meanwhile, attacks on Caspian Sea infrastructure and simmering tensions around Venezuela are propping up prices with a persistent risk premium.

Technically, the charts hint at a potential turnaround—or at least a pause—within the broader downtrend. The Stochastic Oscillator, hovering near oversold territory, is trying to turn upward, signaling that bearish momentum may be running out of steam. Bolstered by a rising Chaikin Oscillator, it appears that buyers are testing the waters once more.

The trading plan down below may be taken as a pattern:

Buy Brent crude at the current price. Place Take profit at $63.40. Set Stop loss at $61.00.

This forecast holds true between December 12 and December 19, 2025.