WTI Crude Oil prices are continuing to drop, hovering near the mid-$65 range. This decline is due to low trading volumes, ongoing concerns about demand, and a lack of any new market drivers. The US benchmark remains in a holding pattern since Wednesday, reflecting traders’ cautious mindset. Market sentiment is careful with two key events coming up: the OPEC+ meeting on July 5 and the July 9 deadline for potential US tariffs. OPEC+ is likely to approve an increase in production by 411,000 barrels per day for August, although actual output is falling short of targets due to supply issues.

Geopolitical Tensions Easing

Geopolitical tensions have eased recently, especially after a ceasefire between Iran and Israel, along with Iran’s commitment to the Nuclear Non-Proliferation Treaty. Despite this, there are ongoing worries about demand. US data revealed an unexpected rise in crude inventories and lower gasoline usage during what should be the peak driving season. The Energy Information Administration reported a 3.8 million barrel increase in stockpiles, while the International Energy Agency has lowered its oil demand growth estimates. Technically speaking, WTI is stabilizing around $65.70, above a significant support level near $64.00. If this support fails, prices could drop to around $60.45. The Bollinger Bands are narrowing, with prices remaining below the 20-day moving average of $67.70, signaling a slightly bearish outlook. The Relative Strength Index at 49 indicates a neutral position, aligning with the current price range. Currently, West Texas Intermediate crude is drifting lower, sitting uncomfortably near the mid-$65 level. Although the decline isn’t drastic, the unwillingness of prices to rise hints at broader market uncertainties. With trading volumes lighter than usual, liquidity is reduced—an unfavorable situation for market clarity.

Market Uncertainties and Upcoming Events

This uncertainty is partly due to two imminent events. The OPEC+ meeting in early July is generating expectations, but those expectations are fading. What was thought to be a small increase in production may turn out to be insignificant if existing supply challenges persist. Russia and other members are struggling to meet their quotas, meaning any agreements may result in minimal real change. Then there’s the July 9 deadline concerning potential tariff decisions from Washington. While this may not directly impact crude barrels, it will certainly affect the overall economic outlook and investor sentiment. Markets dislike politically-motivated binary outcomes, and these deadlines often freeze forward hedging. Short-term focus has shifted to storage levels, and the latest reports are concerning. Stocks increased by 3.8 million barrels, even though drivers are filling their tanks for summer travel. It’s unusual for demand to be weak during this time, and this decline coincides with a sluggish global growth outlook, further deepening the downward trend. From a technical standpoint, the overall vibe feels heavy. The $64.00 level is currently acting as a support floor. However, if that breaks, prices near $60.45 could become possible. The tightening of Bollinger Bands often hints at upcoming directional moves. The price has lingered below the 20-day average, which is a few dollars higher at $67.70. Though this is not inherently negative, coupled with weak momentum—reflected by the Relative Strength Index near 49—it suggests indecision and fatigue. The current market structure presents opportunities, but only with strict discipline. Any rebounds must reclaim the short-term average with sufficient volume to build confidence. Until then, we could see quick reversals and failed price rallies. It’s wise to keep targets modest and risks clearly defined. The potential for a bounce may come from unexpected news or data surprises, but for now, the market trend appears limited and directionally shallow. Create your live VT Markets account and start trading now.

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