West Texas Intermediate (WTI) Oil prices fell on Tuesday during the early European session. WTI is now trading at $60.61 per barrel, down from Monday’s close of $60.90. Brent crude also dropped, trading at $64.50 compared to a previous close of $64.81. WTI Oil is known for its low gravity and low sulfur content, which makes it “light” and “sweet.” It comes from the United States and is distributed from the Cushing hub, serving as a key benchmark in the oil market. WTI prices are often mentioned in the news. Prices for WTI Oil are mainly driven by supply and demand, which can be influenced by global growth, political unrest, wars, and sanctions. The value of the US Dollar also plays a part since oil is traded in USD. A weaker dollar can lower oil prices, while a stronger dollar can raise them. Weekly inventory reports from the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact WTI prices. A drop in inventory usually indicates rising demand and higher prices. OPEC’s production quotas also play a role; reduced quotas can lead to price increases, while higher production can push prices down. OPEC+ includes 10 non-member countries, including Russia. With WTI oil prices around $60.61, there is a bearish sentiment in the market. This follows a period of higher prices earlier in 2025, indicating a downward trend is forming. Traders should be wary, as this could signal a larger market shift. Concerns about global demand are a significant factor in this weakness. Recent manufacturing data from China for October 2025 fell short of expectations, with the Caixin PMI dropping to 49.8, suggesting a slight contraction. Additionally, the U.S. Federal Reserve’s indication that interest rates may stay high is also damaging the outlook for energy demand. On the supply side, everyone is paying attention to the upcoming OPEC+ meeting in early December 2025. While the group has kept production cuts in place, there are rising signs of disagreement among major producers about quotas for 2026. This uncertainty means we can’t count on effective coordinated supply cuts as we could in the past. This week, the focus will be on inventory data. We expect the API report later today, with predictions of a crude oil build of about 1.8 million barrels. If tomorrow’s official EIA report confirms a significant increase in inventory, it could lead WTI prices to test the important psychological support level at $60. Given this bearish outlook, purchasing put options with strike prices around $58 or $59 could be a way to profit from a potential price decline. A bear put spread might also be a smart strategy to minimize upfront costs while targeting a downward move before the OPEC+ meeting. This approach provides a defined-risk opportunity for capitalizing on continued weakness. The strengthening U.S. Dollar, with the Dollar Index (DXY) recently surpassing 107, is adding more pressure by making oil more expensive in other currencies. We should remember the price shocks of 2022, which remind us that any unexpected geopolitical event could quickly change the situation. For now, however, the trend seems to be pointing lower.

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