Trading some ~12.80% higher than 24-month lows made courtesy of Trump’s ‘Liberation Day’, WTI crude and Brent crude currently trade at ~$63.90 and ~$66.01, respectively.
WTI Crude & Brent Crude: Key Takeaways
- Upside for crude oil is likely to remain limited while OPEC+ maintains a trajectory of production hikes, seemingly aiming for more market share and to apply pressure to North American production
- According to yesterday’s report, U.S. crude oil inventories were shown to be falling faster than expected, down by around 1%. Although this would typically be bullish for pricing, momentum was tempered by substantial gains in gasoline and distillate inventories
- Questions on global demand remain, with global manufacturing PMIs, especially out of China, remaining somewhat mixed
- Disrupting 7% of oil production according to Reuters, wildfires in Alberta, Canada, have supported oil pricing in the short term, raising questions on supply
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WTI Crude (WTICOUSD) Price Analysis:
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A chart showing the recent price action of WTICOUSD. OANDA,TradingView, 05/06/2025
- WTI crude is trading higher in today’s session, with the 20 and 50-period SMAs offering support. If price can maintain highs, bulls will aim towards the 100-period SMA, which has proven an area of significant resistance in recent memory.
- In the short term, $62.63 is offered as the nearest level of support, while resistance lies at $63.60, intersecting with the trendline. The next few days of price action are particularly important for short-term oil performance, should price breakdown below the trendline or break above
- According to the 14-period RSI, recent bullish momentum has grounds for a further leg up, still trading well below oversold levels
Brent Crude (BCOUSD) Price Analysis:
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A chart showing the recent price action of BCOUSD. OANDA,TradingView, 05/06/2025
- Unlike its American counterpart, Brent crude still looks to surpass the 50-period SMA, with the next few days of price action being critical for establishing support
- In the short term, we can expect $64.20 to be the next level of resistance, with the same level being used as a period of support mid-April. Otherwise, if prices fall to $64.83, at least some buyers will return to the market
- Similarly to WTI, and owing to sideways movement through much of May, the 14-period ADX rates the last two weeks as ‘weak or absent’ in trend strength. Price currently faces a ‘make-or-break’ scenario on approach to the trendline
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