WTI slumps to near $97.50 as Trump pauses Hormuz operation

WTI price tumbles to near $97.50 in Wednesday’s early Asian session, down 2.20% on the day.
Trump said the operation to reopen the Strait of Hormuz will be paused.
The API reported larger-than-expected crude oil inventories last week.

Lallalit Srijandorn FXStreet

West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $97.50 during the early Asian trading hours on Wednesday. The WTI price falls amid easing tensions in the Middle East. Traders await the release of the Energy Information Administration (EIA) report, which will be published later on Wednesday.

US President Donald Trump said late Tuesday that an operation to reopen the Strait of Hormuz will be paused for a short period to see whether an agreement can be finalized and signed. Trump further stated that the decision was made at the request of Pakistan and other countries and follows what he called “tremendous military success” during a US campaign against Iran.

His latest statement on pausing Project Freedom came hours after the US Defence Secretary Pete Hegseth said the US-Iran ceasefire "certainly holds" for now. Furthermore, US Secretary of State Marco Rubio stated that the military objectives of the so-called “Operation Epic Fury” have concluded, and the offensive stage of the war with Iran is “over.”

US crude oil inventories declined for the third straight week. According to the American Petroleum Institute (API) weekly report, crude oil stockpiles in the US for the week ending May 1 fell by 8.1 million barrels, compared to a decrease of 1.79 million barrels in the previous week. The market consensus was for a decline of 2.8 million barrels.

Goldman Sachs analysts reported that global oil inventories are approaching their lowest level in the last eight years, warning that the rapid reduction in reserves is becoming a critical factor against the backdrop of limited supplies.

WTI Oil FAQs

What is WTI Oil?

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.

What factors drive the price of WTI Oil?

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.

How does inventory data impact the price of WTI Oil

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.

How does OPEC influence the price of WTI Oil?

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.

AUD/USD drops to two-week low, further below 0.7000 after RBA's less hawkish rate hike

AUD/USD drifts lower for the second straight day on Tuesday, hitting a fresh two-week low during the Asian session after the Reserve Bank of Australia's (RBA) widely expected 25 bps rate hike. The decision was far from unanimous, with three members preferring to hold rates at 4.60%. This tempers expectations of further tightening, which, along with modest US Dollar strength, weighs on the currency pair.

USD/JPY fails near 159.00 amid weak USD, intervention risks

USD/JPY edges lower during Tuesday’s Asian session, reversing part of the previous day's gains to 158.00 as the US Dollar remains depressed amid hopes for Iran diplomacy and ahead of US midterm elections. Meanwhile, intervention risks support the Japanese Yen, though the uncertainty over the timing of the next BoJ rate hike caps gains. This keeps the pair confined within a familiar range and warrants caution before placing directional bets.

Gold slides below $3,900 as Fed hike bets counter softer USD ahead of US elections

Gold slides below the $3,900 mark during the first half of the European session, eyeing its lowest level since October 2025, set last week amid expectations of further tightening by the US Federal Reserve. Data released on Monday showed that US manufacturing sector business activity expanded for the 10th consecutive month in October. The Institute for Supply Management's Manufacturing PMI came in higher than consensus estimates and rose to 55.5 in October from 54.5 in the previous month.

Crypto Today: Bitcoin, Ethereum, XRP under pressure as investors pull capital

Bitcoin trades downward at $76,566 on Tuesday, testing six-week lows. Ethereum, like Bitcoin, trades under pressure as it consolidates within a narrow support range. Meanwhile, Ripple hovers marginally above $1.25.

BoE is set to hike rates this week: Warns against 'unwarranted' aggressive tightening

We see a hike as a done deal this week and another, while not yet our baseline scenario, is possible in February should inflation stay above 4%, commodity prices remain high and activity remain resilient. We remain of the view, however, that aggressive tightening is unwarranted, for four main reasons: There are no clear signs of second-round inflation effects, nor do we think that there will be.

The 2% inflation target came from a throwaway remark. It now moves trillions

The Federal Reserve's 2% inflation goal grew out of an off-the-cuff remark by a New Zealand politician in 1988. Bond investors still price long-term US debt as if 2% holds, so a change in how the Fed measures inflation would move markets.