Oil Prices Climb 1.3% to $58.18 as U.S. Stockpiles Drop by 3 Million Barrels
WTI crude oil futures extended gains on Wednesday, rising to around $57.50 per barrel after fresh data signaled a drop in U.S. inventories.
Quick overview
- WTI crude oil futures rose to around $57.50 per barrel following a reported 3 million-barrel decline in U.S. crude inventories.
- Fuel stockpiles also decreased, contributing to tighter supply expectations despite ongoing concerns about long-term oversupply risks.
- Global political uncertainties, including trade discussions between the U.S. and China, are creating caution in the market.
- Technical indicators suggest a potential near-term trend reversal for crude oil prices, with key resistance levels identified.
WTI crude oil futures extended gains on Wednesday, rising to around $57.50 per barrel after fresh data signaled a drop in U.S. inventories. The American Petroleum Institute (API) reported a 3 million-barrel decline in crude stockpiles last week — the first drawdown in four weeks — suggesting a mild tightening in near-term supply.
Fuel stockpiles, including gasoline and distillates, also fell, helping offset broader concerns of a global glut. The U.S. Energy Department announced plans to add 1 million barrels to the Strategic Petroleum Reserve, further tightening supply expectations in the coming weeks.
Still, oil remains pressured by long-term oversupply risks. According to Vortexa, a record 1.24 billion barrels of crude and condensate are currently in transit worldwide, aligning with the International Energy Agency’s (IEA) warning that global stockpiles could surge to new highs next year as OPEC+ output rises amid slowing demand.
Global Politics Add to Market Uncertainty
President Donald Trump went so far as to say that he’s been told India plans to cut back on buying Russian Oil, after he had a chat with PM Narendra Modi – though India’s foreign ministry has already denied that there were even any talks about it.
The whole global trade & sanctions situation is still causing a lot of uncertainty – & on top of that, energy traders are getting a bit nervous about how all this is going to pan out, which is limiting any potential gains even though the US has just released some pretty good data on its own energy storage.
The market’s still being pretty cautious ahead of the big US-China talks next week, which are going to have a big say in how trade routes get used, & how volatile currencies & commodities are going to be.
Technical Setup: Bulls Attempt a Breakout
WTI crude oil is showing early signs of recovery after weeks of declines. Prices have rebounded to $58.18, marking a 1.3% daily gain, and are now attempting to break above a descending channel — a move that could confirm a near-term trend reversal.
A bullish engulfing candle has formed near mid-channel support, backed by RSI divergence — where the Relative Strength Index has risen to 56 while prices continue to post higher lows. The 20-EMA has flattened at $57.30, while the 50-EMA near $58.30 acts as immediate resistance. A sustained close above these levels could trigger a push toward $58.97 and $60.17.
- Buy Zone: $57.20–$57.40 (confirmation above $57.80)
- Targets: $58.95 and $60.10
- Stop Loss: Below $56.00
For traders looking to take a run at this, confirmation really is key – a second bullish candle or an EMA crossover would be a big help to the case for things to keep going up. While we’re still dealing with a bunch of macro risks, our technicals here are at least starting to suggest that crude oil might finally be setting up for its first sustained recovery in a while.
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