The price of crude oil ended at $62.26, which is an increase of $0.39 or 0.63%. Although prices rose today, they’re still below higher levels seen previously. Last week, OPEC+ announced it would increase output by 137,000 barrels per day in October, a move expected after last week’s price drop. This slight increase shows a commitment to keeping prices steady. Economists believe that this cautious approach eases worries about oversupply. At the same time, ongoing geopolitical issues, such as the Russia-Ukraine conflict and the possibility of new U.S. sanctions, continue to support the market. Prices hit a peak of $63.34 before falling, approaching a low of $61.85.

Crucial Market Dynamics

Last Friday, prices fell to $61.45, matching a low from August 18. For sellers to gain more control, they must push prices below this double bottom. The daily chart shows a risk of prices rising above the 100-day moving average, currently at $64.28. As long as prices stay below this level, sellers remain in charge. Crude oil prices have struggled to maintain recent highs, leading to a market caught between different forces. OPEC+’s modest production increase signals their intention to keep prices above $60. However, technical weaknesses mean the price remains below important moving averages. Adding to the pressure, a recent EIA report revealed an unexpected increase in U.S. crude inventories by 1.9 million barrels, contrary to expectations for a seasonal decline. This indicates that short-term supply might be sufficient to meet current demand, explaining why the previous rally above $63 was brief.

Strategic Trading Levels

On the demand side, China’s manufacturing PMI for August 2025 came in at 49.7, marking a second month of contraction. This decline from the world’s largest oil importer poses a significant challenge for the market. Similar demand concerns last summer kept oil prices below $80 per barrel, despite ongoing geopolitical tensions. From a trading perspective, key attention should be on the double bottom at $61.45. If prices break below this support level, it could lead to more selling, making put options or put spreads with strike prices around $60 and $58 a smart choice for the upcoming weeks. Traders should monitor for increased trading volume if the price drops below this support level. On the flip side, the 100-day moving average near $64.28 limits the upside. For traders who believe that geopolitical risks will eventually outweigh weak economic data, call options or bull call spreads could be viable but only after a consistent close above this resistance level. Until then, sellers seem to have the upper hand in this price range. Create your live VT Markets account and start trading now.

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