Oil News: Crude Oil Futures Vulnerable Next Week Below Key 52-Week Average

Crude Oil Futures Edge Higher on Russian Supply Disruption, But Bearish Fundamentals Cap Gains

Light Crude Oil Futures settled at $62.69, up $0.82 or +1.33% for the week, as geopolitical tensions provided brief support, while bearish macroeconomic and supply-side fundamentals continued to limit upside. A Ukrainian drone strike that disrupted loadings at Russia’s Primorsk port contributed to the week’s strength, raising concerns over Russian export flows. However, gains were ultimately constrained by soft U.S. economic data, rising inventories, and ongoing concerns about oversupply, keeping overall sentiment cautious.

Technically, Reaction to 52-Week Moving Average Sets the Tone

Despite the higher close for the week, the market finished on the weakside of the 52-week moving average at $63.45 for the second week in a row. This indicator is controlling the longer-term direction of the market.

A sustained move under the 52-week moving average will signal the presence of sellers. If this generates enough downside momentum then look for a drive toward the swing bottom at $61.12, followed by a Fibonacci level at $60.26. The latter is a potential trigger point for an acceleration to the downside.

Overcoming the 52-week moving average will indicate the return of buyers. However, the subsequent rally could be a labored event with a pair of pivots at $64.56 and $65.41 providing resistance initially, followed by the swing top at $66.03. This top is a potential trigger point for a surge into $68.70.

Geopolitical Risks Offer Temporary Lift to Crude Prices

Friday’s price uptick was driven by reports that a Ukrainian drone attack had suspended crude loadings at one of Russia’s largest western ports. Analysts warned this could curtail Russian crude and refined product exports, injecting new volatility into the supply side. The market also remains alert to potential secondary sanctions or tariffs from the U.S. aimed at reducing Russian oil exports to India and China, the two largest buyers of Moscow’s seaborne crude.

However, geopolitical support was fleeting. Brent and WTI benchmarks fell sharply on Thursday, down 1.7% and 2% respectively, underscoring market skepticism toward price rallies that aren’t backed by tangible supply disruptions.

Bearish Macro Data Weighs on Demand Outlook

Traders shifted their focus late in the week to U.S. economic indicators, which cast a shadow over demand prospects. The Labor Department’s revised jobs data showed the economy had created 911,000 fewer jobs through March than previously estimated. At the same time, August’s Consumer Price Index jumped 0.4%, the largest increase since January.

This combination of slower job growth and sticky inflation is raising doubts about the Federal Reserve’s ability to cut rates in the near term—potentially stalling economic activity and curbing energy consumption.

IEA-OPEC Divide Highlights Supply-Demand Uncertainty

The International Energy Agency (IEA) issued a fresh warning that global oil supply would rise faster than demand this year, citing planned OPEC+ production increases. This confirms market concerns that the supply side continues to outweigh consumption. In contrast, OPEC maintained its higher demand growth projections, arguing that global economic momentum remains solid.

Despite OPEC’s optimistic tone, traders are increasingly positioning for a market that leans toward oversupply, especially as U.S. inventories build and refinery demand softens.

India’s Import Policy Could Disrupt Russian Flows

India’s Adani Group, the nation’s largest private port operator, has banned tankers under Western sanctions from accessing its facilities. Since India is the top importer of Russian seaborne crude, this move introduces further uncertainty around global crude logistics and could restrict Moscow’s ability to reroute exports under sanctions.

Oil Prices Forecast: Bearish with Geopolitical Risk Limiting the Downside

The near-term outlook remains bearish, with traders wary of soft demand, rising U.S. inventories, and expanding OPEC+ output. While geopolitical tensions—especially those affecting Russian infrastructure—are preventing a deeper sell-off, they have not been enough to reverse the broader sentiment.

Unless demand surprises to the upside or supply is materially disrupted, Light Crude Oil Futures are likely to remain under pressure next week, with rallies seen as selling opportunities in a market still dominated by oversupply concerns.

More Information in our Economic Calendar.