WTI Price Forecast: Retreats from four-week high, slips below $104.00 despite supply risks
- WTI attracts some intraday sellers following a modest Asian session rise to a nearly one-month peak.
- Rising geopolitical tensions and Fed rate hike bets support the USD, capping gains for the commodity.
- Supply disruption worries should act as a tailwind for Crude Oil prices and help limit further losses.
West Texas Intermediate (WTI) – the benchmark US Crude Oil price – struggles to capitalize on modest Asian session gains to the $106.45 region, or a nearly four-week high, and retreats to the lower end of its daily range in the last hour. The commodity slips below the $104.00 mark in the last hour, though the downside potential seems limited amid supply concerns.
Rising geopolitical tensions, along with growing bets for an interest rate hike by the US Federal Reserve (Fed), continue to act as a tailwind for the US Dollar (USD). A firmer buck caps the upside for the USD-denominated commodity. Meanwhile, US President Donald Trump threatened to target Iran’s power plants and bridges if the Strait of Hormuz is not reopened on Tuesday, while Iran introduced new conditions for reopening the strategic waterway. This raises the risk of a further disruption to global trade routes and should act as a tailwind for the black liquid.
From a technical perspective, the near-term bias is bullish against the backdrop of last week's rebound from the rising 100-period Exponential Moving Average (EMA) on the 4-hour chart and a breakout beyond the 100.00 psychological mark. This keeps the broader uptrend intact despite recent volatility. Furthermore, the latest Moving Average Convergence Divergence (MACD) reading has turned back up, with the line recovering into positive territory and the histogram improving, suggesting buyers are reasserting control after a brief loss of momentum.
Meanwhile, the Relative Strength Index (RSI) around 61 stays above its midline yet below overbought territory, indicating sustained upside pressure without signs of exhaustion. Hence, any subsequent pullback is likely to attract some buyers around $102.00, where recent intraday pullbacks have stabilized, followed by stronger support near $99.50. The rising 100-period EMA on the 4-hour chart, now clustered below $94.00, reinforces that deeper dips toward the low-$90s would be viewed as corrective while the indicator maintains its upward slope.
On the upside, initial resistance stands at the recent peak near $105.70, and a clear break above this area would open the way toward the $108.00 region next.
(The technical analysis of this story was written with the help of an AI tool.)
WTI 4-hour chart
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
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
