Should You Invest in Crude Oil ETFs Now?
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Crude oil rose about 1% on Oct. 5, 2025, after OPEC+ announced a modest output hike of 137,000 barrels per day for November, a similar amount it announced for October, per a Bloomberg article, as quoted on Yahoo Finance.OPEC+ group stated that “a steady global economic outlook and current healthy market fundamentals” led them to boost output. However, it also indicated that the production adjustments may be stopped or reversed, depending on the market conditions. The broader market remains cautious of oversupply, per the above-mentioned source.Will Oil Stage a Rally?Expectations of weak demand in the fourth quarter may cap the oil market’s upside. The U.S. economy may slow in Q4. S&P Global Ratings Economics now expects the U.S. economy to grow 1.9% in 2025. On a year-over-year basis, the agency forecast real GDP growth of 1.5% in Q4 of 2025 (down from 2.5% in 2024) as well as expected growth of 1.8% in 2026.According to the Energy Information Administration, U.S. crude oil, gasoline and distillate inventories rose more than anticipated in the week ended Sept. 26, as both refining activity and consumption slowed. Total product supplied — a key gauge of demand — declined by 627,000 barrels per day that week, per a Reuters article.Any Silver Lining? Global unrest in the key oil-producing areas may favor oil prices ahead. "OPEC+'s decision to increase production by another 137,000 bpd in November could be manageable in light of rising supply disruptions due to tightening sanctions by the U.S. and Europe against Russia and Iran," ANZ analysts said in a note on Monday, per Reuters, as quoted on MSN."Meanwhile, Ukraine continued to intensify its attacks on Russian energy facilities, targeting the Kirishi refinery, one of Russia's largest refineries, with an annual processing capacity exceeding 20 million tons," the analysts further added.Bottom LineThe likelihood of oversupply concerns may dull any positive price impact originating from the geopolitical risks. As a result, the outlook surrounding the oil market is moderately bearish. Investors should keep a close watch on oil ETFs like United States Oil Fund LP USO, Invesco DB Oil Fund DBO, and United States 12 Month Oil Fund LP USL.Boost Your Portfolio with Our Top ETF InsightsZacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week.Don’t miss out on this valuable resource. It’s free!Get it now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report United States Oil ETF (USO): ETF Research Reports Invesco DB Oil ETF (DBO): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks
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