Crude Oil Drops to $66.35 as Iran Talks Resume and OPEC Eyes 411K bpd Boost
Crude oil prices fell on Friday as renewed diplomatic signals from Iran and expectations of an OPEC+ supply increase trimmed bullish...
Quick overview
- Crude oil prices declined on Friday due to renewed diplomatic signals from Iran and expectations of an OPEC+ supply increase.
- WTI crude fell 0.4% to $66.35 per barrel, while Brent dropped 0.6% to $68.40 amid thin holiday trading.
- Iran's commitment to the nuclear non-proliferation treaty and potential U.S. negotiations have reduced geopolitical risk premiums.
- Traders are closely monitoring support levels, with a significant drop below $65.28 potentially accelerating downside momentum.
Crude oil prices fell on Friday as renewed diplomatic signals from Iran and expectations of an OPEC+ supply increase trimmed bullish sentiment. WTI crude slipped 0.4% to $66.35 per barrel, while Brent fell 0.6% to $68.40 in thin holiday trading amid the U.S. Independence Day lull.
The move comes after Iran reaffirmed its commitment to the nuclear non-proliferation treaty. Iran’s Deputy Foreign Minister Abbas Araqchi stated that Tehran would continue cooperating with the U.N.’s atomic watchdog. This statement, combined with Axios reports of Washington preparing to resume nuclear negotiations with Iran, helped reduce geopolitical risk premiums.
Vandana Hari, founder of Vanda Insights, noted, “The possibility of renewed diplomacy and continued U.N. engagement significantly eases the threat of renewed conflict in the region.”
At the same time, OPEC+ is expected to increase output by 411,000 barrels per day for August, according to Reuters sources. The anticipated announcement, scheduled for Sunday’s meeting, suggests the group is responding to improving supply-demand dynamics and ongoing pressure from major importers to ease price pressure.
Technical Rejection at $67.13 Caps WTI Upside
WTI crude is now trading at $66.35 after rejecting resistance at $67.13—a confluence of the 0.236 Fibonacci retracement from the $77.11 June high and a descending trendline. The failure to reclaim this level and a move back below the 50-period EMA ($66.42) suggest short-term bullish momentum is fading.
The MACD histogram flipped negative, and a bearish crossover confirms declining momentum. Traders are watching the $65.28 support level closely. A sustained drop below it could expose the $64.00 and $62.85 zones—both recent demand areas.
Key Levels to Watch:
- Resistance: $67.13, $69.03 (38.2% Fib), $70.56
- Support: $65.28, $64.00, $62.85
- MACD: Bearish crossover
- Trend Bias: Neutral-to-bearish under $67.13
A breakout above the descending trendline and a daily close above $67.13 would be needed to shift the short-term trend back in favor of buyers.
What Traders Should Watch Next
The combination of easing geopolitical tensions and a likely OPEC+ supply hike is reshaping the short-term oil outlook. With momentum indicators turning bearish and technical resistance holding, WTI may struggle to reclaim higher ground unless market sentiment improves significantly.
Until that happens, traders should prepare for a retest of lower support zones, particularly if volume builds near $65.28. A sharp move below this level could accelerate downside momentum, opening the door to June’s lows. Conversely, renewed buying pressure would need a confirmed breakout above $67.13 to shift the near-term trend bullish.
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