Oil markets enter late September 2025 under pressure from shifting macro signals and diverging supply-demand forecasts. The Federal Reserve’s latest projections paint a weaker employment picture, weighing on energy consumption expectations. Meanwhile, OPEC remains optimistic, projecting steady demand growth into 2026. Let’s take a loot at recent inventory data, positioning in the futures market, and key technical levels shaping crude oil’s near-term outlook.

Department of energy readings last week:

Production -0.1% prior +0,54% change -13k bbl with a big draw on headline stocks of -9.285mil. The distillate stock build however neutralised any bullish elements of this report with a weekly build of 4.046mil expected at a build of 975k.

The market’s running on thin gruel and contradictory hymn sheets. EIA’s STEO has barrels stacking up into late-’25—inventory builds peaking into 4Q25/1Q26—implying softer prices and a curve that can’t justify heroics. Translation: non-OPEC growth plus the OPEC+ unwind keeps the shelves from looking bare, at least on their spreadsheet.

OPEC reads the tape differently. Their MOMR still hangs its hat on sturdier demand—~1.3 mb/d growth in 2025 and ~1.4 mb/d in 2026—leaning toward a tighter balance as the year wears on and into next. That skew (and their tolerance for “managed” supply) says deficits can re-appear if shale cools and maintenance/interruptions bite.

Goldman pretty bearish on oil.

I think the bearishness we see in oil right now is directly attributable to the FOMC in which 4.5% unemployment has become the new 4.3% projection to 2025 year-end.  This was a much worse picture estimated by The Fed than at the prior meeting. Less employment, less industry, less oil consumption. This is the black hole of selling that front month prices simply can not escape.

Here is how the projections around uncertainty have grown from the Summary of Economic Projections.

Commitment Of Traders:

Summary

Short specs covered 12,845 contracts last week, to put this in perspective, this rate of change is larger than 74.6% of all other observations….EVER. I am long and have been for about 2 weeks. This is what I want to see. Important to note that pretty much all of the open added interest was from Commercials long and Non Commercials long.

Open interest +5,505

Commercials Long +1,747

Commercial Short +14,341

Non Comm Long +4,020

Non Comm Short -12,845 – rate of change -1.14 sigma

Specs short position change

Commercial Positioning Near Historic Long Levels

I have been monitoring to see when commercials would start building length, which is what they did in 2 of the last 3 readings. On September 2nd they added 42k long contracts. They are at a 96.7% all time crowding. Net length 820,579 contracts. The longest they ever go in history was 922,957 contracts on May 15th 2007.

I am by no means saying we are going back to astro highs like in 2007 as we are a far way off that level of Commercial length. But I do want to highlight that they are in the top 10% concentration here of length.

Commercial Net longs

Front month WTI historical non back adjusted.

WTI C.O.T Commercials long-Seasonal distribution

Speculators Shift Toward Net Long Exposure

When I think of Specs, I think of spreaders. They are mainly not exposed to outright flat price movement, If they want to be long, they will be long 2 contracts, short 1. If they want to be short, they will be short 2 and long 1. So I monitor to see if specs are increasing or decreasing net directional weight. This gives me insight on their directional bias as a group.

Spec shorts retreated in the last week and added to the net length by 4,020 contracts. The additional longs -not a massive indication by any means, but its enough to show me they are increasing weight on the long side.

Net long 278,276

Net Short 179,567

WTI Trade Levels and Technical Outlook

Selling continues to balance the market down in the quarterly value area, with QPVAL a firm downside swing target for shorts $59.79

WTI Front month November futures. Daily bars. Q-VWAP

The oil market sits at a crossroads, pulled between bearish macroeconomic headwinds and OPEC’s confidence in sustained demand. Positioning data shows commercials building toward historically long levels while speculators cautiously increase exposure on the long side. Short-term technicals continue to cap rallies, but if inventories tighten and U.S. employment stabilizes, a more constructive backdrop could emerge. For now, traders remain watchful, balancing downside risks with the potential for a supply-driven rebound into late 2025.