Oil News: WTI Crude Nears Moving Average Resistance as Bulls and Bears Square Off

WTI Crude Oil Tests Moving Averages as Oversupply Risks Build

Light crude oil futures extended their rebound for a fourth straight session on Wednesday, climbing off key support between $60.40 and $59.91. The rally places WTI within striking distance of the 200-day moving average at $63.03 and the 50-day at $63.22, two technical levels likely to dictate near-term market direction.

Sellers are expected to defend the moving average zone given the prevailing downtrend. However, a sustained break above $63.22 would shift momentum in favor of the bulls, opening the door to a run toward the long-term 50% retracement level at $64.21. On the downside, minor support is seen at $61.52, with the broader support zone at $60.40 to $59.91 still in play.

At 10:52 GMT, Light Crude Oil Futures are trading $62.40, up $0.67 or +1.09%.

OPEC+ Output Hike Underwhelms as Market Eyes Glut

Oil prices found some support from OPEC+’s decision to increase November output by just 137,000 barrels per day—matching October’s increment and falling short of earlier expectations. Analysts noted the increase was minimal and unlikely to alter near-term supply-demand balances unless accompanied by rising inventories.

“The bare minimum that OPEC+ decided to get away with still provided some support,” noted PVM analyst Tamas Varga. Yet, concerns persist about a looming oversupply, especially with global inventories projected to build in coming months. Goldman Sachs sees an inventory build of 1.5 million bpd in the last quarter and expects a surplus of 2 million bpd stretching through late next year.

U.S. Output Hits Records, EIA Sees Prices Under Pressure

The U.S. Energy Information Administration added to the bearish narrative, raising its domestic crude output forecast to 13.53 million bpd this year—an all-time high—up from a previous estimate of 13.44 million. This revision was attributed to stronger-than-expected July production and accelerated offshore Gulf output.

EIA now expects WTI crude to average $65 a barrel this year, while Brent is forecast at $68.64—both down roughly 15% year-over-year. The agency also warned that rising global inventories will weigh heavily on prices through the end of this year and into next.

Inventory Data in Focus as Traders Brace for Near-Term Volatility

Investors await official U.S. crude and gasoline stockpile data from the EIA, with expectations for a 400,000 barrel build. On Tuesday, API reported a much larger 2.78 million barrel increase in crude stocks, though gasoline and distillates declined.

With the physical market yet to reflect production increases through sustained inventory builds, traders remain cautious. Any signs of demand weakness or further stock builds could cap upside potential.

Market Forecast: Bearish Bias Holds Below Key Technical Levels

Despite the short-term recovery, the broader technical and fundamental picture remains bearish. Unless WTI crude can decisively clear both the 200-day and 50-day moving averages—currently acting as resistance—rallies are likely to be sold into. Surging U.S. production, rising global inventories, and modest OPEC+ output increases all point to persistent downside pressure on oil prices.

More Information in our Economic Calendar.