WTI holds gains near $57.50 due to potential supply concerns
- WTI advances on supply risks amid possible delays to a Ukraine peace deal.
- President Trump said the Ukraine peace talks made progress, but no territorial breakthrough.
- China said it plans to increase fiscal spending in 2026, signaling ongoing support for growth that could lift Oil demand.
West Texas Intermediate (WTI) Oil price rebounds after registering 2.5% losses in the previous session, trading around $57.30 per barrel during the European hours on Monday. Crude Oil prices rise as investors weigh the risk of a global supply glut amid potential delays to a Ukraine peace deal.
US President Donald Trump and Ukrainian President Volodymyr Zelenskiy are going to talk this weekend. Bloomberg reported Sunday that President Trump said he had made “a lot of progress” in discussions with Zelenskiy, though he noted no clear breakthrough on territorial issues and said a deal could still take several weeks.
Oil prices extend gains amid ongoing Middle East tensions, with Saudi airstrikes in Yemen and Iran’s “full-scale war” rhetoric against the United States (US), Europe, and Israel raising supply disruption risks.
Reuters cited IG analyst Tony Sycamore, who said traders are watching US enforcement against Venezuelan oil shipments and potential fallout from US strikes on ISIS targets in Nigeria, which produces about 1.5 million barrels per day.
China said it plans to increase fiscal spending in 2026, signaling ongoing support for growth that could lift Oil demand. However, crude remains on course for a decline of over 20% this year, its sharpest annual drop since 2020, amid expectations of a global surplus next year.
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.
Author
Akhtar Faruqui
FXStreet
Akhtar Faruqui is a Forex Analyst based in New Delhi, India. With a keen eye for market trends and a passion for dissecting complex financial dynamics, he is dedicated to delivering accurate and insightful Forex news and analysis.
