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Oil News: WTI Sinks Below 200-Day Moving Average as Bearish Oil Outlook Builds
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Key Points:
- WTI futures plunged below the 200-day MA, closing at $61.87, as sellers target the $61.12 and $56.09 support levels.
- Brent and WTI both posted weekly losses as OPEC+ supply risks and weak U.S. data triggered bearish oil sentiment.
- OPEC+ may unwind 1.65M bpd in cuts early, risking a supply glut that could send crude prices even lower.
OPEC+ Whispers and Weak U.S. Jobs Data Slam Oil Prices
Let’s talk about what’s pressuring oil right now. WTI futures got smoked on Friday, sliding below the 200-day moving average at $63.31 and closing at $61.87. That’s not just a technical breakdown — it’s a red flag for trend-followers. That 200-day level is now resistance, and sellers look like they’re targeting the August 13 low at $61.12. If that goes, we could be looking at a real run toward the May 30 low of $56.09.
Brent didn’t escape the selloff either — down 2.22% to settle at $65.50. That capped off a rough week where Brent lost nearly 4% and WTI dropped over 3%. The vibe is clear: bulls are pulling back, and the market’s bracing for more supply.
On Friday, Light Crude Oil Futures settled at $61.87, down $1.61 or -2.54%.
Will OPEC+ Flood the Market Early?
The big catalyst here? OPEC+ is rumored to be eyeing more production increases at its meeting this Sunday. Reuters broke the story midweek, and traders have been digesting it ever since. If the eight-member subset of OPEC+ greenlights more barrels, they’ll be unwinding another 1.65 million bpd in cuts — more than a year ahead of schedule. That’s 1.6% of global demand.
Commerzbank’s take? If that happens, brace for more downside. With inventories already rising and demand signals softening, another supply boost could push the market into surplus fast.
U.S. Inventory Surprise Adds Fuel to the Bearish Fire
Speaking of supply, last week’s U.S. crude stockpile data caught everyone off guard. Analysts expected a draw, but the EIA reported a 2.4 million barrel build. That’s the kind of miss that shakes confidence, especially when paired with rising OPEC+ volumes.
PVM’s John Evans summed it up well: “There are increasing signs that feedstock supply isn’t going to be an issue.” Translation? The market isn’t tight anymore.
Jobs Data Undermines Demand Outlook
Then there’s the demand side — and it’s not looking too hot either. Friday’s U.S. jobs report came in light, with just 22,000 new payrolls versus expectations of 75,000. Weak labor numbers usually translate to weaker energy demand, and traders took that as a fresh excuse to hit the sell button.
Phil Flynn from Price Futures Group called it a “perfect storm” — bearish OPEC chatter and soft economic data piling on at the same time.
Market Forecast: Bearish Into the Weekend
With WTI decisively below the 200-day moving average and OPEC+ potentially opening the spigots again, this market is looking heavy. Barring a geopolitical wildcard (like a sudden Russian supply disruption), the near-term setup favors more downside. Watch $61.12 — if that support breaks, we could see a quick slide toward $56.
Oil bulls need either OPEC+ restraint or a bullish demand shock to shift momentum. Right now, neither is on the table.
More Information in our Economic Calendar.
About the Author
James Hyerczykauthor
James Hyerczyk is a U.S. based seasoned technical analyst and educator with over 40 years of experience in market analysis and trading, specializing in chart patterns and price movement. He is the author of two books on technical analysis and has a background in both futures and stock markets.
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