WTI Oil Is About to Break Out as Supply Cuts and Trade Talks Fuel Bullish Momentum
West Texas Intermediate (WTI) crude oil is approaching a major technical milestone—the 200-day moving average, which is making many people optimistic about the energy markets. As of Tuesday morning, WTI futures remained above $65.64, up 0.54 percent, indicating growing optimism among traders that the bullish trend may intensify.
US-China Trade Talks Restore Hope for Global Demand
The second day of trade talks between the United States and China in London is having a significant impact on public sentiment toward the oil market. President Trump’s comments about “good progress” in the talks have boosted investor confidence. A prospective agreement is anticipated to boost cross-border economic activity and revive demand for crude oil, which underpins global transportation and industrial output.
The Brent benchmark reached $67.19, its highest since April. The US dollar lost 0.3 percent on the DXY index, making oil even more tempting to foreign buyers by making crude oil priced in dollars cheaper.
Saudi Supply Curbs Indicate Strategic Restraint
Saudi Aramco has stated that it will limit crude oil exports to China by one million barrels in July, which is surprising given that OPEC+ claimed it would boost output by 411,000 barrels per day. This decision raises questions about how thoroughly the supply agreement will be carried out in practice.
According to Reuters, OPEC’s overall output increased by only 150,000 bpd in May, falling far short of forecasts. Iraq and the UAE failed not meet their targets, indicating that internal discipline remains a major driver in the slow supply rise.
Technical Outlook: WTI Is Approaching Important Resistance
Technically, WTI is approaching the 200-day moving average of $66.47. If there is a clean breakthrough, it might lead to $68.21. Analysts recommend keeping an eye on what’s going on in the world, particularly the evolving US-Iran nuclear talks, which might quickly modify the supply position.
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