Oil News: WTI Eyes Breakout—Oil Outlook Bullish on Inventory Draw and Iran Risks

WTI Futures Eye Breakout Above 200-Day Moving Average

Light crude futures surged early Wednesday, building on Tuesday’s gains but falling just short of the 200-day moving average at $66.45. Prices touched $66.28 before retreating slightly into the close, with bulls now eyeing a clean break above technical resistance for confirmation of sustained upside.

If sellers reassert control, traders are watching $63.09 as a nearby support pivot. A decisive move above $66.45 could open the door toward the next major upside target near $68.21.

At 10:54 GMT, Light Crude Oil Futures are trading $65.93, up $0.95 or 1.46%.

OPEC+ Output Rises, But Domestic Demand May Absorb Extra Supply

OPEC+ plans to raise production by 411,000 barrels per day in July, marking a fourth consecutive monthly increase. Yet analysts say the impact on global supply could be muted. Saudi Arabia and other OPEC+ members are likely to see increased domestic demand during summer months, helping absorb the added barrels. According to Capital Economics, this internal consumption may support prices in the near term by offsetting the supply increase.

U.S.-China Trade Truce Lifts Risk Appetite—But Demand Questions Remain

WTI’s seven-week high reflects renewed risk appetite following U.S.-China trade talks. The two sides have agreed on a framework to revive their trade truce and ease restrictions on rare earth exports, boosting sentiment.

As the world’s top two oil consumers, easing tensions reduces downside price risk. However, PVM’s Tamas Varga cautioned that traders remain uncertain about how much this progress will actually translate into stronger economic activity or higher oil demand.

Geopolitical Risk Premium Builds on Iran Threats

Geopolitical tensions are also back in focus. President Trump voiced skepticism about Iran’s willingness to curb uranium enrichment, while Tehran threatened to strike U.S. bases in the region if talks break down. The hardening rhetoric adds a premium to prices, with traders pricing in the potential for supply disruptions in the event of a broader conflict.

Crude Oil Inventory in Focus Ahead of EIA Report

Ahead of the official EIA inventory release, preliminary API data showed a 370,000-barrel draw in U.S. crude stocks last week. A confirmed decline would provide fresh support for prices, reinforcing the bullish tone heading into midweek trade. All eyes remain on the EIA figures for confirmation. Traders are looking for a draw of 2.4 million barrels.

Oil Prices Forecast: Bullish Bias Building Above Key Resistance

With support from geopolitical tensions, easing trade concerns, and stable demand fundamentals, the outlook for crude remains bullish—provided WTI can close above its 200-day moving average. A confirmed breakout could invite fresh buying, setting up a run toward the $68.00 handle. Failure to hold current gains, however, risks a pullback to the $63.00 area.

More Information in our Economic Calendar.