WTI Price Forecast: Extends correction below $100
- The Oil price slides below $100 as fears of US resuming attacks on Iran have diminished.
- US Secretary of State Rubio said that President Trump prefers a diplomatic resolution.
- Iran signals that talks with the US through Qatari mediators are still going on.
West Texas Intermediate (WTI), futures, on NYMEX, is down 2.25% to near $99.80 during the European trade on Monday. The oil price extends its correction that started after failing to progress the rally above $104.03, the five-month high posted on Friday.
The WTI price comes under pressure as fears of prolonged energy supply risks have diminished, following signals from the United States (US) that it would prioritize diplomatic resolution with Iran over resuming military action.
Over the weekend, US Secretary of State Marco Rubio said that Washington hasn’t made any decision to renews strikes on Tehran and that President Donald Trump prefers a diplomatic resolution. However, Rubio kept fears of military action alive, stating that the US retains the capabilities to achieve whatever military objective Trump decides to pursue.
Separately, the comments from Iran that talks are ongoing with Qatari mediators on a plan to reopen the Strait of Hormuz within two days if the US cooperates have also eased energy supply fears, Al Jazeera reported.
Meanwhile, lower oil prices suggest that financial markets are ignoring claims from US media personality and political commentator Tucker Carlso that Israeli Prime Minister (PM) Benjamin Netanyahu is pressing US President Donald Trump to launch a nuclear strike on Iran, alleging that Washington could take a decision on the use of nuclear weapons within days, The Times of India (ToI) reported.
WTI Technical Analysis
In the daily chart, WTI US Oil trades below $100, holding just under the 9-day exponential moving average (EMA) at $100.09, which caps the topside and keeps the near-term bias mildly bearish despite the strong rally from the mid-$80s.
Price action sitting below this short-term EMA suggests that bulls are losing traction, while the Relative Strength Index (14) around 58 stays in positive territory, hinting at still constructive momentum that has yet to translate into a clear bullish break above immediate resistance.
On the topside, the five-month high at $104.03 is the critical hurdle for oil prices. On the downside, the October 20 low at $95.05 might act as key support level.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
WTI Oil FAQs
What is WTI Oil?
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
What factors drive the price of WTI Oil?
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
How does inventory data impact the price of WTI Oil
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
How does OPEC influence the price of WTI Oil?
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.