WTI crude dropped 2.08% to a 4-week low as the dollar surged to a 5.5-month high. But here's what's interesting: oil recovered after Ukraine rejected the US-Russia peace plan, suggesting geopolitical risk premiums are still priced in.

The real story? Russia's oil exports hit a 3-year low at 1.7M bpd in mid-November. Ukraine's been hitting refineries hard—knocked out 13-20% of Russia's refining capacity, cutting exports by ~1.1M bpd. New US-EU sanctions on Russian oil infrastructure are tightening the screws further.

Countervailing pressures: OPEC cut its Q3 forecast from a -400k bpd deficit to a +500k bpd surplus. US production beat expectations (now projected at 13.59M bpd for 2025), and OPEC itself ramped up output. The IEA is even warning of a record 4M bpd global surplus in 2026.

Net result: Oil's stuck in a tug-of-war between supply disruptions from sanctions/Ukraine strikes and macro headwinds (strong dollar, growing surplus). Tanker storage just hit a 5-month high—traders are hedging bets.