Crude Oil Radar

Published: 10/07/2025 Focus: Crude Oil

The oil market has been thinking we have too much supply on the market - and they are right but in a different lens than most think. Supply/Demand balances have been much better globally than traders are giving credit. Inventories globally have been very healthy indicating that we have solid demand for our current level of supply. Into this winter and first quarter of 2026 (normally a very bearish time frame - just due to seasonal demand), OPEC+ is releasing more barrels into the market +137,000 bopd for November (and likely every month there after for 12 months). Balance this with a sharp inventory increase in Diesel in the US - and we may have the canary in the coalmine - how quickly it is increasing is an indication of reduced industrial activity and possibly farm activity (due to lower demand from tariffs). Capping off the fundamentals - we are balanced today but need demand increases in 2026 to remain balanced. Technicals are right at the key support/resistance level of 61.64 - this is the last line of support before dropping to the 50s. My stance remains that I think we drop into the 50s and then in 2026 start a long term structural increase in crude demand and crude prices. 61.64 is the number to watch this week with 63.80 and 66.84 as resistance while 67.35 and 53.87 are the support levels.

Updated: 2025-10-07 23:47:01 Length: 480 chars

The crude oil market is navigating a complex landscape, where supply is perceived as excessive, yet global supply-demand balances are more favorable than some traders acknowledge. OPEC+ is adding 137,000 bopd from November, potentially shifting dynamics. However, a notable diesel inventory increase in the U.S. may signal reduced industrial activity. Technically, crude prices hover around critical support at $61.64; a drop below could lead to the 50s. Watch for demand growt...

Technical Outlook

Moderately Bearish

Score: -3/5

Short: SELL | Medium: SELL | Long: SELL

International Prices

Brent: $65.47 $0.94

WTI: $61.69 $0.81

Spread: $3.78 (Brent premium of $3.78)

Key Fundamentals

Crude Stocks: N/A (0)

Net Imports: N/A (0)

News Sentiment

BULLISH

Spec Positioning

Net Position: 26,483

Weekly Change: 10,316

Overall Technical Score (-5 to +5): -3 (Moderately Bearish)

Current Price: $62.28

Signal: Moderately Bearish

Moving Averages (9/20)

BEARISH

MA(9): $62.63

MA(20): $63.08

Current Price is 62.28, 9 day MA 62.63, 20 day MA 63.08

MACD (12, 26, 9)

BEARISH

MACD: -0.5891

Signal: -0.4054

Days since crossover: 5

MACD crossed the line 5 days ago and is in a bearish setup

RSI (14)

NEUTRAL

Value: 46.29

Category: NEUTRAL

RSI is 46.29 (note 70% is overbought and 30% is oversold)

Volume (vs 20d Avg)

LOWER

Current: 9,184

Avg (20d): 224,591

Ratio: 0.04

Volume is lower versus 20 day average

Stochastic (14, 3)

BULLISH CROSS

%K: 31.23

%D: 20.21

Stochastic %K: 31.23, %D: 20.21. Signal: bullish cross

ADX (14)

NO TREND

ADX: 12.42

+DI: 18.81

-DI: 23.53

ADX: 12.42 (+DI: 18.81, -DI: 23.53). Trend: no trend

Williams %R (14)

NEUTRAL

Value: -68.77

Williams %R: -68.77 (neutral zone)

Bollinger Bands (20, 2)

BELOW MIDDLE

Upper: 65.74

Middle: 63.08

Lower: 60.41

Price vs BBands (20, 2): below middle. Upper: 65.74, Middle: 63.08, Lower: 60.41

Category	Current	Last Week	Last Year	3 Yr Avg
Crude Production (Thousand Barrels a Day)	13505.0	13501.0	13200.0	12733.33
Crude Imports (Thousand Barrels a Day)	5833.0	6495.0	6456.0	6263.33
Crude Exports (Thousand Barrels a Day)	3751.0	4484.0	3897.0	4461.67
Refinery Inputs (Thousand Barrels a Day)	16168.0	16476.0	16353.0	15751.33
Net Imports (Thousand Barrels a Day)	2082.0	2011.0	2559.0	1801.67
Commercial Crude Stocks (Thousand Barrels)	416546.0	414754.0	413042.0	420065.67
Crude & Products Total Stocks (Thousand Barrels)	1695087.0	1687905.0	1649879.0	1636650.33
Gasoline Stocks (Thousand Barrels)	220694.0	216569.0	220083.0	218548.67
Distillate Stocks (Thousand Barrels)	123577.0	122999.0	122921.0	117116.0

International Price Summary

Brent crude (DEC 25) settled at $65.47, change $+0.94. WTI crude (NOV 25) settled at $61.69, change $+0.81. The Brent-WTI spread is currently $3.78 (Brent premium of $3.78). The Brent-WTI spread reflects differences in global vs. U.S. supply/demand dynamics, geopolitics, and transportation costs.

Brent Crude

$65.47

0.94

(DEC 25)

WTI Crude

$61.69

0.81

(NOV 25)

Brent-WTI Spread

$3.78

Brent premium of $3.78

OPEC Market Analysis

Executive Summary:

The current OPEC market situation reflects a slight decline in crude oil prices, with the OPEC Reference Basket averaging $69.73/b in August. Despite bearish sentiment from hedge funds, the physical crude market fundamentals remain solid, supported by stable global economic growth and a consistent demand forecast.

Key Market Metrics:

Category	Production (mb/d)	Demand (mb/d)
World Production	105.135	105.135
Non-DoC Production	51.439	N/A
DoC Production	42.40	N/A

Supply-Demand Balance Analysis:

The balance of supply and demand shows that total world production matches total world demand at approximately 105.135 mb/d, indicating a balanced market. However, with Non-DoC production at 51.439 mb/d, the potential for surplus exists if demand does not increase as forecasted.

Production Landscape:

In 2025, the major contributors to world production include the Americas (25.186 mb/d), Europe (13.509 mb/d), and the Middle East (9.014 mb/d). Notably, Non-DoC production is primarily driven by the US (22.068 mb/d) and Canada (6.063 mb/d), while OPEC's DoC production has shown a slight increase to 42.40 mb/d.

Demand Patterns:

Global oil demand is projected to grow by 1.3 mb/d in 2025, with significant contributions from the non-OECD regions, particularly China (16.853 mb/d) and India (5.704 mb/d). The OECD demand growth is modest, with only a 0.1 mb/d increase expected, highlighting a potential challenge for producers in maintaining higher prices.

Non-DoC vs DoC Analysis:

Non-DoC production stands at 51.439 mb/d, significantly higher than DoC production at 42.40 mb/d. This indicates that Non-DoC producers, particularly the US and Canada, are playing a crucial role in the global supply landscape, potentially impacting OPEC's pricing power.

OPEC's Strategic Position:

OPEC's current market position is characterized by a cautious outlook due to bearish sentiment in futures markets and a balanced supply-demand scenario. The organization may consider adjusting production levels to stabilize prices amidst fluctuating demand forecasts.

Forward-Looking Indicators:

As we look ahead, the market is likely to experience continued volatility due to external economic factors and production adjustments by Non-DoC countries. OPEC's ability to respond effectively to these changes will be critical in maintaining market stability.

Key Insights and Recommendations:

Monitor Non-DoC production trends closely, as they pose a significant impact on global supply dynamics.
OPEC should consider strategic production cuts if demand growth does not meet expectations to support prices.
Focus on enhancing cooperation among member countries to ensure a unified response to market challenges.
Stay vigilant regarding geopolitical developments that could affect oil supply and demand.
Invest in market intelligence to better anticipate shifts in consumer behavior and demand patterns.

Sentiment: Bullish but Weakening

Positioning: Normal Range

Report Date: 2025-09-23

Managed Money

26,483

Change: -10,316

1.4% of OI

Producer/Merchant

283,712

Change: -9,029

14.6% of OI

Swap Dealers

-402,312

Change: +5,178

-20.8% of OI

Open Interest

1,936,690

Change: -25,930

Summary Analysis:

CFTC Commitment of Traders Report (Disaggregated) as of 2025-09-23

Crude Oil Positioning (WTI-PHYSICAL - NYMEX):

Open Interest: 1,936,690 contracts (-25,930)

Managed Money Net Position: 26,483 contracts (1.4% of OI)

Weekly Change in Managed Money Net: -10,316 contracts

Producer/Merchant Net Position: 283,712 contracts

Swap Dealer Net Position: -402,312 contracts

Market Sentiment (based on Managed Money): Bullish but Weakening

Positioning Analysis (Managed Money): Normal Range

Key Takeaways:

- Managed Money traders are large speculators, often driving price trends in Crude Oil.

- Producer/Merchant positions primarily reflect hedging activity.

- Swap Dealers act as intermediaries.

- Extreme positioning by Managed Money can indicate potential market reversals.

- CFTC data reports positions as of the report date, usually released each Friday.

About Disaggregated CoT Reports:

The Disaggregated CoT report provides a more detailed breakdown of futures market open interest.

It categorizes traders into: Producer/Merchant/Processor/User (Commercials), Swap Dealers, Managed Money (Speculators), and Other Reportables.

Market Sentiment Overview

BULLISH

Average Polarity: 0.7

Confidence: 1.0

Articles Analyzed: 37

Last Updated: 2025-10-07 23:49:35

Commodity Sentiment

CRUDE_OIL

0.7

Economic Sentiment Summary

POSITIVE - Economic indicators generally supportive

Dollar Impact: Strong USD may pressure commodity prices

Industrial Demand: Strong industrial demand signals

Interest Rate Impact: Rising rates may impact energy demand

Risk Sentiment: Low market volatility/risk appetite

Economic Indicators

USD_INDEX

98.88

Daily: 0.77 (0.79%)

Weekly: 1.17 (1.2%)

US_10Y

4.13

Daily: -0.04 (-0.84%)

Weekly: 0.02 (0.51%)

SP500

6714.59

Daily: -25.69 (-0.38%)

Weekly: 3.39 (0.05%)

VIX

17.24

Daily: 0.87 (5.31%)

Weekly: 0.95 (5.83%)

GOLD

4033.0

Daily: 84.5 (2.14%)

Weekly: 165.5 (4.28%)

COPPER

5.08

Daily: 0.09 (1.84%)

Weekly: 0.25 (5.14%)

Current Price: $62.28

Closest Support: $60.4 3.02% below current price

Closest Resistance: $62.79 0.82% above current price

Fibonacci Retracement Levels

0.0 $60.4 Support

0.236 $62.79 Resistance

0.382 $64.26

0.5 $65.46

0.618 $66.65

0.786 $68.35

1.0 $70.51

Fibonacci Extension Levels

1.272 $73.26

1.618 $76.76

2.0 $80.62

2.618 $86.87

Current Price: $61.73

Forecast Generated: 2025-10-07 23:49:37

Next Trading Day: UP 0.2%

Date	Prediction	Lower Bound	Upper Bound
2025-10-08	$61.85	$59.91	$63.8
2025-10-09	$61.89	$59.94	$63.83
2025-10-10	$61.81	$59.87	$63.76
2025-10-11	$61.77	$59.82	$63.71
2025-10-12	$61.75	$59.81	$63.7

ML Insights

Forecast generated using ARIMA(5, 1, 0).
The model predicts a price increase of ~0.20% for the next trading day (2025-10-08), reaching $61.85.
The 5-day forecast suggests relatively stable prices between 2025-10-08 and 2025-10-12.
The average confidence interval width is ~6.3% of the predicted price, indicating model uncertainty.
SIGNAL: Bullish signal, moderate uncertainty.

💹

For Energy Traders:

The recent bearish sentiment in the market, as indicated by the $64.02 average for NYMEX WTI, suggests potential volatility ahead. The Brent-WTI spread has widened to $3.78, reflecting differing supply/demand dynamics and providing traders with short-term opportunities to exploit arbitrage.

The current resistance levels can be observed around $67.26 for Brent and $64.02 for WTI, while support levels may form near $62.00. Traders should monitor the speculative positioning, as managed money has shifted to a net short position, indicating potential for price reversals if sentiment changes.

⛽

For Producers (Oil & Gas Companies):

With OECD commercial inventories at 2,761 mb, which is significantly lower than historical averages, producers should consider adjusting their production planning to align with market sentiment and demand forecasts. The $69.73/b ORB value indicates room for strategic pricing.

The hedging strategies should be revisited, especially given the bearish shift in managed money positioning. Maintaining flexibility in production and sales strategies will be crucial as market dynamics evolve, particularly with the ongoing geopolitical factors impacting supply reliability.

🏭

For Consumers (Industrial/Refineries/Transportation):

Input cost fluctuations are expected as WTI and Brent prices hover around $61.69 and $65.47, respectively. The geopolitical tensions and inventory levels should be closely monitored, especially given that crude imports to the US have increased, indicating potential supply reliability risks.

Consumers may want to explore procurement strategies that incorporate hedging against price volatility, particularly as market sentiment remains weakening despite overall bullish indicators. Ensuring a diversified supply chain will mitigate risks associated with demand fluctuations in the coming months.

📊

For Commodity Professionals (Analysts, Consultants):

The Crude Oil market is currently influenced by a combination of bearish sentiment from speculative positioning and strong demand forecasts in non-OECD regions. The supply-demand balance remains tight, with a forecasted growth in oil demand of 1.3 mb/d for 2025.

Key driving factors include the impact of geopolitical events on supply chains and the need for producers to adapt to changing market conditions. Analysts should remain vigilant for shifts in sentiment that could signal potential market outlook changes, particularly as managed money positions indicate a possible reversal.

Disclaimer: This analysis is for informational purposes only and does not constitute financial advice or specific recommendations. Always conduct your own research and consult with a financial advisor before making investment decisions.