09:00 AM EST, 11/04/2025 (MT Newswires) -- Oil prices weakened early on Tuesday, pressed by continuing over-supply concerns and signs of a slowing U.S. economy.

West Texas Intermediate crude oil for December delivery was last seen down US$0.79 to $60.26 per barrel, while January Brent oil was down $0.73 to $64.16.

The drop follows OPEC+'s weekend decision to add a third monthly tranche of member quota hikes of 137,000 barrels per day for December, while saying it will pause production hikes in the first quarter of next year. The decision comes after the cartel completed the return of 2.2-million barrels per day of production increases in September as it looks to regain market share from producers in North and South America.

Still, U.S. demand has so far stayed robust, with the Energy Information Administration last week reporting U.S. commercial oil inventories were 6% under the five-year average despite near-record domestic production. However analysts expect stocks to begin rising as the U.S. economy slows. Walt Chancellor, an energy strategist at Macquarie Group, said he expects the agency to report a solid rise in stocks on Wednesday on higher imports.

"We are forecasting US crude inventories up 6.2 MM BBL for the week ending October 31. This follows a 6.9 MM BBL draw in the prior week, with the crude balance realizing significantly tighter than our expectations," Chancellor noted.

Further signs of a U.S. economy struggling to cope with rising costs amid President Donald Trump's capricious tariff policies came Monday, as the ISM Manufacturing Index fell for a eighth-straight month in October to 48.7% from 49.1% a month earlier. A figure below 50% indicates a contraction in activity for the sector.

"Industrial demand has yet to reappear, and each manufacturing PMI comes complete with a subsection on the effects of tariffs. Yesterday, private PMI reports from both South Korea and China reported slowing export orders paying particular attention to diminished demand from the United States. The blame for which is placed firmly at the foot of tariffs and a lack of confidence in industrial sectors. This was completely echoed later in the day by another disappointing reading in the ISM manufacturing report that showed eight-straight months of contraction as orders shrank and lines of supply from overseas increased delivery times," PVM Oil Associates noted.