WTI Oil Holds $63 as OPEC+ Adds 137K bpd and Traders Watch Fed Risks
WTI crude oil futures rose above $63 per barrel on Wednesday for the third day in a row. The increase came after OPEC+ announced...
Quick overview
- WTI crude oil futures rose above $63 per barrel for the third consecutive day following a smaller-than-expected OPEC+ supply increase.
- Analysts suggest that OPEC+ is prioritizing market stability over rapid output normalization amid steady but slowing demand.
- Geopolitical tensions, particularly Israel's airstrike on Hamas, are raising concerns about potential disruptions in the energy-exporting region of Qatar.
- Traders are closely monitoring resistance levels around $63.40-$63.70, with a breakout needed for clearer direction amid mixed signals.
WTI crude oil futures rose above $63 per barrel on Wednesday for the third day in a row. The increase came after OPEC+ announced a 137,000 b/d supply increase starting in October, smaller than previous monthly hikes. The move suggests producers are being cautious not to over supply the market at a time when demand is steady but slowing.
Analysts say the smaller production boost means OPEC+ is prioritizing market stability over rapid output normalization. While the group is unwinding voluntary cuts, the pace shows a preference for stability over expansion.
Geopolitical Tensions Apply Pressure
Beyond supply, geopolitical risks are again supporting crude oil. Prices rose after Israel launched an airstrike on Hamas leadership in Doha, Qatar. Given Qatar’s role as a major energy exporter, the attack raised questions about potential disruptions in the region.
This follows months of instability in the Middle East, with Israel also operating in Iran, Syria, Lebanon and Yemen. Market participants are watching for any escalation that could impact global supply chains.
In the West, political tensions added another layer of uncertainty. Reports say former US President Donald Trump has asked the EU to impose 100% tariffs on Chinese and Indian goods, with Washington prepared to mirror any such move. This could impact global trade and oil demand.
WTI Crude Oil Levels to Watch
From a technical standpoint, WTI crude is at $63.30, testing the resistance band between $63.40 and $63.70 where the 50-period EMA and the upper descending channel line converge. Multiple rejection candles in this zone make it a key level.
Momentum indicators are showing some improvement. The RSI has bounced to 53, higher lows after bouncing off oversold levels. But a series of spinning top candles indicates indecision, often a precursor to a move.
For traders:
- A close above $63.70 could open up the 200-EMA at $64.90, then $65.97.
- Failure to clear resistance, especially with a bearish engulfing candle, could send prices back to $62.08 and then $61.45.
WTI Crude Oil Outlook
In the near term, oil is at a junction. The small OPEC+ supply increase is supportive, but geopolitical risks are keeping the market on edge. But US inventory data showing a 1.25 million barrel build last week has taken the wind out of the sails.
Traders are waiting for a breakout above the $63.40-$63.70 zone to get direction. Until then, crude is range bound, stuck between supply caution, geopolitical tension and demand uncertainty.
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