Oil News: Crude Futures Stall Below Moving Averages as Traders Eye EIA Inventory Data

Crude Oil Edges Up as Traders Weigh Inventory Mix and Economic Headwinds

Light crude futures are treading water just above last week’s lows early Wednesday, with traders eyeing a projected 2.5 million barrel drawdown in U.S. crude inventories ahead of the EIA’s official report at 15:30 GMT.

A modest bid has returned after Tuesday’s API print revealed a surprise 6.52 million barrel build in crude — but sharp drops in gasoline and distillates helped offset the bearish tone.

At 12:02 GMT, Light Crude Oil Futures are trading $60.65, up $0.09 or +0.15%.

Refined Products Cushion Sentiment After Crude Build

The API numbers were messy, but traders are leaning into the refined product side for direction. Gasoline fell 5.65 million barrels and distillates dropped 2.46 million, signaling that end-user demand is still holding up — at least for now. UBS’s Giovanni Staunovo noted that the drawdowns likely “supported sentiment” even as the crude build caught some off guard.

Still, with crude supply rising, demand strength needs to keep proving itself — especially as global economic signals flash warning lights.

Dollar Strength and Manufacturing Slump Cap the Rally

Weak factory data from the U.S. and China is capping upside momentum. October marked the seventh straight contraction for China’s manufacturing sector and the eighth for the U.S., both underscoring slower industrial demand — not great news for oil bulls.

Layer on a surging U.S. dollar — trading at a three-month high — and the headwinds get stiffer. A stronger dollar makes oil more expensive for overseas buyers and tends to dampen demand. With the Fed showing no clear signal of cutting rates in December, the dollar bid could linger, further pressuring crude.

Geopolitical Supply Disruptions Offer Limited Lift

Russia’s Black Sea port of Tuapse suspended fuel exports following a Ukrainian drone strike that also shuttered a nearby refinery. While this adds a layer of geopolitical risk premium, it hasn’t been enough to drive a meaningful breakout, especially with OPEC+ set to increase output by 137,000 barrels per day in December.

The group’s decision to hold off on any new output increases until Q1 2026 has done little to change near-term sentiment.

50-Day MA Forms Technical Roadblock

Technically, WTI crude faces stiff resistance at the 50-day moving average near $61.33 and even tougher overhead at the 200-day moving average at $61.81. The market is still trading below the long-term 50% retracement level at $63.74 — a ceiling that buyers haven’t been able to threaten.

On the downside, $59.64 (last week’s low) is acting as a soft floor. The more critical area sits in the $59.27–$58.49 range — a short-term retracement zone that could draw dip-buyers looking for value. If that zone cracks, aggressive sellers may press prices lower to flush out weak longs.

Oil Prices Forecast: Cautiously Bearish Unless Demand Steps Up

Bottom line: Refined product drawdowns are offering a floor, but the crude build, weak global data, and strong dollar are keeping upside in check. Unless the EIA confirms solid demand or buyers defend key support levels, the path of least resistance leans lower — at least for now.

More Information in our Economic Calendar.