WTI crude oil futures remained under pressure on Wednesday, trading just below $69 per barrel, marking its lowest level since December 2024. The market continues to grapple with supply-side developments and economic policy shifts that could shape the demand outlook in the coming months.
The downward trend in crude prices reflects growing market expectations of increased oil availability, particularly from Russia, Venezuela, and Iraq.
Brent crude has also struggled to gain momentum, slipping to $73.60 per barrel, reinforcing the broader weakness in energy markets.
One of the key factors pressuring oil prices is the potential Russia-Ukraine peace deal, which has fueled expectations of an eventual easing of Western sanctions on Russian crude exports. Reports suggest that the US and Ukraine have reached a draft minerals agreement, a move that aligns with President Trump’s efforts to broker a resolution to the conflict.
If sanctions on Russian energy exports are lifted, global oil supply could see an increase of at least 2 million barrels per day (bpd), according to analysts. This shift would add downward pressure on prices, especially as global demand expectations remain subdued.
The market is also closely watching Trump’s broader trade strategy, which includes higher tariffs on China, Mexico, and the European Union. These trade policies could slow economic growth and indirectly weaken crude demand.
Elsewhere, Iraq announced an agreement with Kurdistan to resume crude exports, although officials have not provided a clear timeline. If fully implemented, this deal could bring 450,000 bpd of additional oil back to the global market, further softening prices.
At the same time, Trump’s decision to revoke Chevron Corp.’s license to operate in Venezuela raises concerns over long-term Venezuelan production. However, short-term supply disruptions remain limited, and Venezuela’s oil exports are unlikely to see an immediate impact.
Crude oil has faced continued downward pressure, with prices dropping 0.45% in the latest session. The price opened at $69.074 and closed at $68.763, with a high of $68.883 and a low of $68.673. The MACD remains negative, confirming ongoing bearish momentum, while the short-term moving averages (5, 10, 30) are acting as resistance, keeping prices suppressed. A recent low of $68.36 was tested, suggesting that support is forming at this level, though the broader trend remains weak.
Picture: Crude oil hovers near $68.76 after extended bearish pressure, as seen on the VT Markets app
Looking ahead, if oil breaks below $68.36, further downside toward $68.00 or lower is likely. Conversely, a move above $69.10 could spark a short-term recovery, with resistance around $69.50-$70.00.
Traders will be watching US crude inventory data later this week for further direction. The latest API report indicated a surprise build of 3.2 million barrels, suggesting that demand remains weaker than expected.
With oil on track for its largest monthly decline since September, volatility remains a key factor for traders navigating the current market landscape.
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