Missed The Last Oil Rally? This Pullback Could Be Your Second Chance

As of June 30, WTI Crude is trading near $64 a barrel – down over 17% from this month’s peak of $77.80. This sharp correction has returned prices to a key technical zone, one that previously triggered a 25% rally in May.

While headlines blame OPEC+ supply increases and a fading war premium, seasoned traders know this setup for what it is: a sentiment-driven flush masking a structurally bullish market. According to analysts at GSC Commodity Intelligence, this is not a breakdown – this is opportunity.

More Barrels, Same Problem: The Market Remains Structurally Tight

Yes, OPEC+ plans to add 411,000 bpd in August on top of the 1.78 million bpd already added in 2025. Kazakhstan is overshooting its quota by another 390,000 bpd, which has spooked some traders into short-term selling.

But here’s the real picture according to data compiled by GSC Commodity Intelligence: Global oil demand is on track to hit a record 104.5 million bpd in Q3 2025, up 2.2 million bpd year-over-year.

Meanwhile, spare capacity is shrinking. OECD inventories are still 15% below the five-year average and U.S Shale production is plateauing, constrained by capital discipline and higher financing costs.

As analysts at GSC put it: “even with the OPEC+ boost, the market remains structurally tight”.

Geopolitical Risk Didn’t Vanish – It’s Just Mispriced

The ceasefire between Israel and Iran erased an estimated $10–$15 per barrel war premium, leading to a swift market sell-off. But history shows such optimism rarely lasts.

Data tracked by GSC Commodity Intelligence – shows over 25% of global Oil flows through the Strait of Hormuz and any disruption – even temporary – could spark a $20–$30 spike overnight.

Diplomatic tensions remain unresolved, sanctions are tightening and Iran’s rhetoric hasn’t softened.

Trump’s SPR Refill Could Reset the Price Floor

During his January 2025 inaugural address, President Trump vowed to “refill the Strategic Petroleum Reserve (SPR) right to the top.”

Now with the SPR sitting at 346.8 million barrels – the lowest since 1983, and Oil trading back at multi-year lows – Trump has a unique opportunity to buy cheap Oil – and markets know it.

Historically, large-scale SPR refills have coincided with massive rallies. In 2009, the SPR refill coincided with a 53% rally in Oil over 6 months.

In 2020, emergency purchases triggered a 70% rebound in 8 months.

Any move by the Trump administration to refill at $60–$65 levels could set a new price floor and spark another historic rally.

History Shows Pullbacks Like This Don’t Last Long

Analysts at GSC highlight a familiar pattern. In 2016, WTI dropped 25% before rallying 48% in five months.

In 2020, a 30% fall was followed by a 56% surge in six months. More recently, in 2022, prices fell 19% and then soared 41%.

Today’s setup mirrors these conditions: falling prices, fragile sentiment, but unchanged fundamentals. As analysts at GSC puts it: “this is classic asymmetric opportunity. Temporary weakness, long-term strength and a market caught offside.”

This May Be the Best Oil Entry Point of 2025

With global demand climbing, supply tight, geopolitical risk under-priced and the U.S government likely to step in as a buyer – this pullback could be a gift to forward-looking traders.

As GSC summed it up in a recent note: “Crude Oil has rarely looked this asymmetric. Prices have corrected hard – but the fundamentals haven’t.”

As the famous saying goes – in the midst of chaos lies opportunity. This might just be the last best chance to load up on Oil before the next leg higher.