WTI Oil Rises to $65.75 on Trade Hopes & Inventory Drop.
WTI climbs past $65.50 amid renewed optimism over U.S. trade developments
FUNDAMENTAL OVERVIEW:
West Texas Intermediate (WTI), the U.S. crude oil benchmark, is trading near $65.75 during early European hours on Thursday, supported by optimism over a new U.S. trade agreement and a sharper-than-expected drop in domestic crude inventories.
The recent trade deal announced by U.S. President Donald Trump with Japan—featuring “reciprocal” 15% tariffs, notably lower than the previously threatened 25%—has fueled hopes for improved global economic conditions. Expectations of further agreements, including progress in U.S.-EU trade negotiations, have also lifted market sentiment and buoyed oil prices.
WTI received an additional boost from data showing a larger-than-anticipated decline in U.S. crude inventories. According to the Energy Information Administration (EIA), stockpiles fell by 3.169 million barrels in the week ending July 18, exceeding forecasts for a 1.4-million-barrel drop, although slightly less than the previous week’s 3.859-million-barrel decrease.
Looking ahead, traders are closely watching Thursday’s EU-China summit—marking President Xi Jinping’s first in-person meeting with EU leaders since 2023. Additionally, U.S. Treasury Secretary Scott Bessent’s upcoming talks with Chinese officials in Stockholm next week could influence trade dynamics. Any signs of renewed friction may reignite concerns about global fuel demand, potentially pressuring oil prices.
CRUDE OIL TECHNICAL ANALYSIS CHART:
Technical Overview:
Crude Oil is trading within a down channel.
Crude Oil is moving below 50&100 Moving Averages (SMA).
The Relative Strength Index (RSI) is in Buying Zone, while the Stochastic oscillator suggests Neutral trend.
Immediate Resistance level: 66.15
Immediate support level: 64.63
HOW TO TRADE CRUDE OIL
On the higher time frame, Crude Oil experienced a sharp decline before entering a consolidation phase within a defined range. It established a support level, from which price began showing signs of bullish interest. Currently, Crude Oil has rebounded from this support zone and is trading near a key resistance area. A breakout above this resistance could open the door for further upside potential.