WTI declines to near $89.50 as Trump rules out attacks on Iran before midterm elections
- WTI price edges lower to near $89.65 in Friday’s early Asian session.
- Trump said the US would not attack Iran before November’s midterm elections.
- IEA agreed to accelerate oil reserve release.
West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $89.65 during the early European trading hours on Friday. WTI declines after US President Donald Trump said Washington would not attack Iran before November’s midterm elections.
Reuters reported on Thursday that Trump dismissed the possibility of attacking Iran before the US midterm elections, emphasizing ongoing "productive discussions" with Tehran. US President added that crude was flowing through the Strait of Hormuz in “record numbers. This development could weigh on the WTI price in the near term.
Furthermore, the International Energy Agency (IEA) agreed to accelerate the release of oil stocks and prioritize diesel supplies as governments grapple with record fuel prices and war-related supply disruptions. The announcement from the IEA followed an agreement by G7 countries last week to release 100 million barrels of crude and diesel, which raised expectations of additional oil stock releases.
US crude oil inventories unexpectedly declined last week. According to the Energy Information Administration (EIA), crude stockpiles fell by 3.186 million barrels in the week ending October 2, reversing the previous week’s increase of 922,000 barrels. The market consensus was for a rise of 1.9 million barrels.
Middle East tensions keep WTI risk premium elevated into US midterms
Analysts at ABN Amro flag that “escalation risk into midterms” is increasingly supporting crude, with news that President Trump has asked the Pentagon to ready Iran strike plans ahead of the US Midterm elections and “escalating tanker attacks in regions outside the Omani route, such as off Qatar and in the Gulf of Oman,” helping to fuel upside in oil prices. While they note that “flows from the region have largely normalized,” ABN Amro cautions that “the need for US navy escorts, increased costs and logistical frictions and constant risk of being attacked call into question the longer-term feasibility of the flows.” In their view, “this ultimately warrants a sticky risk premium to remain in pricing,” with “CTAs are buyers of WTI crude on the day, and both WTI and brent crude are long across all momentum signals once again.”
Technical Analysis: WTI keeps a mildly bullish tone in the near term
In the daily chart, WTI US Oil holds above both the 100-day simple moving average (SMA) and the lower Bollinger Band, which keeps the near-term bias mildly bullish despite the recent pullback from the $90 area. Price remains below the Bollinger middle band, suggesting that while the broader uptrend is still supported by underlying demand, the latest consolidation under the mid-channel is tempering upside momentum; the Relative Strength Index (14) near 49 reinforces a neutral, range-bound tone rather than strong directional pressure.
On the topside, initial resistance is located at the Bollinger middle band around $92.25, with a break higher exposing the upper Bollinger Band near $99.35 as the next bullish objective. On the downside, immediate support is seen close to the lower Bollinger Band at $85.15, ahead of the more strategic floor provided by the 100-day SMA near $84.10, where buyers would be expected to defend the broader ascending structure if corrective pressures deepen.
(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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