WTI rises above $100.50 after strike on Saudi refinery
- WTI price climbs to near $100.75 in Wednesday’s early European session.
- Yemen's Houthis say they hit Saudi Arabia’s Ras Tanura oil refinery with missile.
- Crude oil inventories dropped by 2.031 million barrels in the week ended October 23, API said.
West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $100.75 during the early European trading hours on Wednesday. WTI rises after an attack on a refinery in Saudi Arabia renewed concerns around supply risks from the major exporter.
Reuters reported that Yemen's Iran-aligned Houthis on Tuesday had launched a ballistic missile toward the Ras Tanura oil refinery in eastern Saudi Arabia, the kingdom’s largest refinery.
For now, the market is still pricing in a greater likelihood of re-escalation, said ING commodity strategists. "Oil prices remain elevated as the market waits for greater clarity on President Trump's next move toward Iran," ING strategists added.
US crude oil inventories fell last week. According to the American Petroleum Institute (API), crude stockpiles declined by 2.031 million barrels in the week ending October 23, compared to a fall of 4.93 million barrels in the previous week.
Traders await the release of the Energy Information Administration (EIA) crude oil stockpiles report later on Wednesday. A larger-than-expected crude oil inventory draw indicates stronger demand and could lift the WTI price, while a bigger build than estimated signals weaker demand or excess supply, which might undermine the WTI price.
Oil outlook stays skewed higher as Middle East risks and freight costs bite
According to TD Securities, crude prices are likely to remain biased higher in the near term, with analysts arguing that “we expect crude oil will remain skewed to the upside in the near term as escalation risk ahead of Israeli elections and US midterm elections remains elevated.” They highlight that “recent Houthi strikes have seen risk premium pricing in the market increase, while persistent tanker attacks by Iran appear to have been successful in reducing some Hormuz flows,” further underpinning the geopolitical premium in benchmarks. At the same time, TD Securities stresses that “beyond escalation in the Middle East conflict, freight rates have increasingly become the important marginal driver, with elevated landed prices for refiners potentially putting a cap on crude oil upside as weaker margins may limit refiner runs,” suggesting that rising transport costs could increasingly temper the upside even as geopolitical risks persist.
Technical Analysis: WTI retains a constructive outlook above the 100-day SMA
In the daily chart, WTI US Oil maintains a constructive bullish bias as it holds well above the 20-day Bollinger middle band and comfortably above the 100-day moving average. Price action is pressing into the upper half of the Bollinger envelope, while the Relative Strength Index (14) at roughly 62 stays in positive territory without yet flagging overbought conditions, which suggests ongoing upside pressure but with scope for corrective pauses.
On the topside, immediate resistance is aligned with the upper Bollinger band near $103.95, where bulls may face the next meaningful supply zone. On the downside, initial support is seen at the 20-day Bollinger middle band around $95.05, ahead of a deeper cushion from the lower Bollinger band near $86.15 and the 100-day moving average just above $85.00, levels that together define the broader bullish floor as long as they remain intact.
(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.
Author
Lallalit Srijandorn
FXStreet
Lallalit Srijandorn is a Parisian at heart. She has lived in France since 2019 and now becomes a digital entrepreneur based in Paris and Bangkok.
