WTI posts modest gains above $88.50 on unexpected EIA draw, Middle East conflicts in focus
- WTI price trades with mild gains near $88.55 in Thursday’s early Asian session.
- Crude oil inventories rose by 3.186 million barrels in the week ended October 2, EIA said.
- The Saudi-led coalition said it retaliated against Houthis.
West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $88.55 during the early Asian trading hours on Thursday. WTI posts modest gains as US crude oil inventories fell unexpectedly last week. Traders will focus on fresh Houthi attacks in Saudi Arabia and continuing oil flows out of the Middle East.
US crude oil inventories showed a surprise draw last week. According to the Energy Information Administration (EIA), crude oil stockpiles in the US for the week ending October 2 fell by 3.186 million barrels, compared to an increase of 922,000 barrels in the previous week. The market consensus was for a rise of 1.9 million barrels.
However, the International Energy Agency (IEA) agreed to accelerate a release of strategic oil stocks in an effort to address surging fuel prices. This, in turn, might cap the upside for the WYO price. The IEA has deployed about 325 million barrels of oil under the March emergency action plan to address the supply disruption triggered by the Iran war.
Furthermore, escalating tensions in the Middle East could boost the black gold in the near term. Iran-backed Houthi militants in Yemen launched fresh strikes on Saudi Arabia. Saudi-led coalition said that it retaliated against the Houthis, adding that the attacks "will not go unpunished.” The coalition said on Wednesday that it had attacked more than 80 Houthi military sites across the governorates of Saada, Hodeidah, Jawf, and Marib.
CTA flows in WTI crude track systematic response across tapes
According to TD Securities, trend-following commodity trading advisors remain net long WTI Crude, with current exposure described as “23.0%” of maximum historical size and an upside trigger level flagged at “$97.70.” The bank’s “CTA Positioning Estimate (rhs) WTI Crude Prices” framework maps how systematic positioning could evolve across different market regimes, distinguishing between “CTA positioning est., WTI Crude, downtape,” “CTA positioning est., WTI Crude, flat tape,” “CTA positioning est., WTI Crude, uptape,” and “CTA positioning est., WTI Crude, big uptape” scenarios through the forecast horizon.
Technical Analysis: WTI holds below the 20-day SMA, with bearish momentum
In the daily chart, the near-term bias of WTI US Oil turns bearish, as price has slipped back under the 20-period Bollinger simple moving average, leaving it capped beneath the recent volatility midline while still holding above the 100-day simple moving average (SMA). The lower Bollinger band reinforces a soft demand area just above the longer-term trend floor, while the Relative Strength Index (RSI) at 46.33 drifts below the midline and hints at waning upside momentum rather than outright oversold conditions.
On the topside, immediate resistance is located at the Bollinger middle band at $92.50, with a stronger barrier coming in at the upper band near $99.90, where prior buying pressure could fade again. On the downside, initial support is seen at the lower Bollinger band around $85.05, followed by the 100-day SMA at $84.15, a level that would need to hold to prevent a deeper corrective slide toward the mid-$80s.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
Nothing in this material constitutes investment advice, personal recommendation, investment research, an offer, or a solicitation to buy or sell any financial instrument. The content has been prepared without consideration of your individual investment objectives, financial situation, or needs, and should not be treated as such.
Past performance is not a reliable indicator of future performance and/or results. Forward-looking scenarios or forecasts are not a guarantee of future performance. Actual results may differ materially from those anticipated.
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