West Texas Intermediate (WTI) crude oil prices ticked higher in Asian trading on Monday, though the move lacked strong follow-through as the commodity remained stuck in a tight range above last week’s three-month low. At the time of writing, WTI was up 0.50% on the day, trading near $62.65–$62.70.
Geopolitics lend support, oversupply concerns limit upside
Crude prices found modest support from geopolitical risks. Group of Seven (G7) finance ministers discussed potential new sanctions on Russia and tariffs on countries viewed as enabling its war in Ukraine during a call on Friday. The talks followed Ukraine’s drone strikes that disrupted loadings from Russia’s largest western port.
Meanwhile, continued unrest in the Middle East has raised concerns about supply disruptions, further underlining the geopolitical risk premium in oil markets.
However, upside remains capped by signs of oversupply. US crude inventories rose unexpectedly last week, pointing to weaker demand in the world’s top oil consumer. Additionally, OPEC+’s decision to raise output from October is fueling market concerns about a growing supply glut. These factors have discouraged traders from committing to aggressive long positions.
Technical outlook
From a chart perspective, WTI’s sideways action may be viewed as a bullish consolidation phase. Still, the recent breakdown below the 100-day Simple Moving Average (SMA) suggests sellers are likely to re-emerge at higher levels. This warrants caution before calling a definitive bottom in the near term.
