What a difference a week makes: last week - demand is too soft, China is importing a million barrels a day that it does not need at the moment (they are filling their SPR), economic indicators are pointing down. Then the US ups the tension on Venezuela while pursuing tankers that according to the US are moving oil that is under sanction through the dark fleet. Combine that with rhetoric from the Trump administration that Venezuela needs to give back the US oil they stole (that is a much deeper discussion for another day - as it is Venezuelan Oil and at one point US companies like Exxon and Chevron operated there and then they were kicked out - so it is nuanced from different perspectives). This news and lack of a peace deal in Ukraine/Russia, WTI traded back to the key support point of 57.35 which is the most critical support holding crude up from dropping to the 40s. This week, I am watching 57.35 as the bull/bear line, and 53.87 as the next support if that falls, with 61.64 as the resistance.
ER
Crude Oil Radar
2025-12-28 00:05
Table of Contents
Brian's Thoughts
Today's Update
Crude oil markets are experiencing a whirlwind of activity. Last week, demand concerns loomed large with China filling its SPR while US tensions with Venezuela escalated, prompting WTI to test critical support at $57.35. As talks of a Ukraine peace deal surface, oil prices have dipped, reflecting market uncertainty. Watch for key levels: support at $53.87 and resistance at $61.64. The combination of geopolitical tensions and fluctuating demand signals a volatile path ahead, making this an intriguing time for traders.
Market Summary
Technical Outlook
Moderately Bearish
Score:
-2/5
Short: SELL
|
Medium: BUY |
Long: SELL
International Prices
Brent:
$60.64
$1.6
WTI:
$56.74
$1.61
Spread:
$3.9
(Brent premium of $3.90)
Key Fundamentals
Crude Stocks:
N/A
(0)
Net Imports:
N/A
(0)
News Sentiment
BEARISH
Spec Positioning
Net Position:
74
Weekly Change:
6,804
Technical Analysis
Overall Technical Score (-5 to +5):
-2
(Moderately Bearish)
Current Price:
$56.74
Signal:
Moderately Bearish
Moving Averages (9/20)
BEARISH
MA(9): $56.92
MA(20): $57.91
Current Price is 56.74, 9 day MA 56.92, 20 day MA 57.91
MACD (12, 26, 9)
BULLISH
MACD: -0.5578
Signal: -0.6468
Days since crossover: 3
MACD crossed the line 3 days ago and is in a bullish setup
RSI (14)
NEUTRAL
Value: 42.66
Category: NEUTRAL
RSI is 42.66 (note 70% is overbought and 30% is oversold)
Volume (vs 20d Avg)
LOWER
Current: 148,278
Avg (20d): 212,425
Ratio: 0.7
Volume is lower versus 20 day average
Stochastic (14, 3)
BEARISH CROSS
%K: 33.08
%D: 51.91
Stochastic %K: 33.08, %D: 51.91. Signal: bearish cross
ADX (14)
WEAK TREND
ADX: 20.31
+DI: 15.33
-DI: 25.26
ADX: 20.31 (+DI: 15.33, -DI: 25.26). Trend: weak trend
Williams %R (14)
NEUTRAL
Value: -66.92
Williams %R: -66.92 (neutral zone)
Bollinger Bands (20, 2)
BELOW MIDDLE
Upper: 60.44
Middle: 57.91
Lower: 55.38
Price vs BBands (20, 2): below middle. Upper: 60.44, Middle: 57.91, Lower: 55.38
Fundamental Analysis
| Category | Current | Last Week | Last Year | 3 Yr Avg |
|---|---|---|---|---|
| Crude Production (Thousand Barrels a Day) | 13843.0 | 13853.0 | 13631.0 | 13001.33 |
| Crude Imports (Thousand Barrels a Day) | 6525.0 | 6589.0 | 5984.0 | 6406.0 |
| Crude Exports (Thousand Barrels a Day) | 4664.0 | 4009.0 | 3099.0 | 4458.67 |
| Refinery Inputs (Thousand Barrels a Day) | 16988.0 | 16860.0 | 16659.0 | 16362.33 |
| Net Imports (Thousand Barrels a Day) | 1861.0 | 2580.0 | 2885.0 | 1947.33 |
| Commercial Crude Stocks (Thousand Barrels) | 424417.0 | 425691.0 | 421950.0 | 427644.0 |
| Crude & Products Total Stocks (Thousand Barrels) | 1687122.0 | 1684734.0 | 1628917.0 | 1613007.33 |
| Gasoline Stocks (Thousand Barrels) | 225627.0 | 220819.0 | 219689.0 | 224957.67 |
| Distillate Stocks (Thousand Barrels) | 118500.0 | 116788.0 | 121335.0 | 117702.67 |
International Price Analysis
International Price Summary
Brent crude (FEB 26) settled at $60.64, change $-1.6. WTI crude (FEB 26) settled at $56.74, change $-1.61. The Brent-WTI spread is currently $3.9 (Brent premium of $3.90). The Brent-WTI spread reflects differences in global vs. U.S. supply/demand dynamics, geopolitics, and transportation costs.
Brent Crude
$60.64
1.6
(FEB 26)
WTI Crude
$56.74
1.61
(FEB 26)
Brent-WTI Spread
$3.9
Brent premium of $3.90
OPEC Analysis
World Demand 2025
105.14
million barrels/day
Demand Growth 2025/24
+1.30%
year-over-year
World Demand Comparison (2025 vs 2026)
Regional Demand Breakdown
Quarterly Trends (2025-2026)
Supply-Demand Balance
China Oil Demand Trend
India Oil Demand Trend
United States Oil Demand Trend
Economic Growth vs Oil Demand
Year-over-Year Market Analysis
OPEC Countries Production
Data Sources Used:
World Demand
Supply Balance
China Data
India Data
US Data
Economic Growth
World Demand
105.14
mb/d
+1.30%
OECD / Non-OECD
OECD:
45.97
Non-OECD:
59.17
Asia Giants
China:
16.86
India:
5.66
Supply Gap
42.47
mb/d
DoC Required
OPEC Market Analysis
Market At a Glance
The global oil market is experiencing a tightening supply-demand balance, with world oil demand projected to reach 105.1 mb/d in 2025, reflecting a growth of +1.4 mb/d year-on-year. The demand for crude from OPEC participating countries is expected to rise, albeit at a slower pace, with a forecast of 42.4 mb/d in 2025. As the market adjusts, OPEC's production decisions will be critical in navigating these dynamics.
Today's Critical Numbers
- World oil demand: 105.1 mb/d
- OECD oil demand growth: +0.1 mb/d
- Non-OECD oil demand growth: +1.2 mb/d
- China's oil demand growth forecast for 2025: 4.8%
- India's oil demand growth forecast for 2025: 6.5%
Supply vs Demand Gap Analysis
- Current gap size: 42.4 mb/d
- Regions driving the deficit: OPEC participating countries
- Implications for OPEC production decisions: With demand for DoC crude projected to increase, OPEC may consider adjusting production levels to meet this demand while balancing market stability.
Regional Powerhouses
- China's demand trajectory remains strong, with a forecasted growth rate of 4.8% for 2025.
- India's growth story is robust, projected at 6.5% for 2025, indicating a significant increase in oil consumption.
- The Americas show resilience, with stable demand patterns supporting overall market balance.
- Europe faces challenges, with stagnant demand growth impacting overall oil consumption in the region.
What's Next
- 2025-2026 outlook: Global oil demand is expected to grow by +1.4 mb/d in 2026, supported by continued growth in non-OECD regions.
- Risks and opportunities: Potential geopolitical tensions and economic fluctuations could impact demand and supply dynamics.
- Market-moving factors to watch: Changes in OPEC production levels and shifts in global economic growth forecasts will be critical.
Key Takeaways
- Most surprising data point: The steady growth forecast for non-OECD oil demand at +1.2 mb/d.
- Biggest risk factor: Geopolitical tensions that could disrupt supply chains and impact oil prices.
- Opportunity area: Increasing demand in India presents a significant growth opportunity for OPEC producers.
- Strategic recommendation: OPEC should consider strategic production adjustments to align with the increasing demand from key markets.
Americas
25.34 mb/d
China
16.86 mb/d
India
5.66 mb/d
Asia Pacific
9.78 mb/d
Europe
13.51 mb/d
Middle East
8.96 mb/d
CFTC CoT Analysis
Sentiment:
Bullish but Weakening
Positioning:
Normal Range
Report Date:
2025-12-16
Managed Money
74
Change: -6,804
0.0% of OI
Producer/Merchant
247,515
Change: -4,668
12.9% of OI
Swap Dealers
-320,087
Change: +10,593
-16.7% of OI
Open Interest
1,916,438
Change: 48,472
Summary Analysis:
CFTC Commitment of Traders Report (Disaggregated) as of 2025-12-16
Crude Oil Positioning (WTI-PHYSICAL - NYMEX):
Open Interest: 1,916,438 contracts (+48,472)
Managed Money Net Position: 74 contracts (0.0% of OI)
Weekly Change in Managed Money Net: -6,804 contracts
Producer/Merchant Net Position: 247,515 contracts
Swap Dealer Net Position: -320,087 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.
News Analysis
Market Sentiment Overview
BEARISH
Average Polarity:
-0.4
Confidence:
1.0
Articles Analyzed:
17
Last Updated:
2025-12-28 00:04:24
Commodity Sentiment
CRUDE_OIL
-0.4
Top News Topics
Infrastructure (2 articles)
Geopolitical (1 articles)
Economic Analysis
Economic Sentiment Summary
POSITIVE - Economic indicators generally supportive
Dollar Impact:
Weaker USD may support commodity prices
Industrial Demand:
Strong industrial demand signals
Interest Rate Impact:
Stable/lower rates may support demand
Risk Sentiment:
Low market volatility/risk appetite
Economic Indicators
USD_INDEX
98.05
Daily:
0.07 (0.08%)
Weekly:
-0.55 (-0.55%)
US_10Y
4.14
Daily:
0.0 (0.0%)
Weekly:
-0.01 (-0.36%)
SP500
6929.94
Daily:
-2.11 (-0.03%)
Weekly:
95.44 (1.4%)
VIX
13.6
Daily:
0.13 (0.97%)
Weekly:
-1.31 (-8.79%)
GOLD
4552.7
Daily:
72.1 (1.61%)
Weekly:
191.3 (4.39%)
COPPER
5.84
Daily:
0.34 (6.2%)
Weekly:
0.4 (7.35%)
Fibonacci Analysis
Current Price:
$56.74
Closest Support:
$54.98
3.1% below current price
Closest Resistance:
$56.85
0.19% above current price
Fibonacci Retracement Levels
0.0
$54.98
Support
0.236
$56.85
Resistance
0.382
$58.01
0.5
$58.95
0.618
$59.89
0.786
$61.22
1.0
$62.92
Fibonacci Extension Levels
1.272
$65.08
1.618
$67.83
2.0
$70.86
2.618
$75.77
ML Price Prediction
Current Price:
$56.74
Forecast Generated:
2025-12-28 00:04:26
Next Trading Day:
DOWN 0.17%
| Date | Prediction | Lower Bound | Upper Bound |
|---|---|---|---|
| 2025-12-27 | $56.64 | $55.08 | $58.21 |
| 2025-12-28 | $56.53 | $54.97 | $58.1 |
| 2025-12-29 | $56.53 | $54.96 | $58.09 |
| 2025-12-30 | $56.69 | $55.13 | $58.26 |
| 2025-12-31 | $56.79 | $55.22 | $58.35 |
ML Insights
- Forecast generated using ARIMA(5, 1, 0).
- The model predicts a price decrease of ~0.17% for the next trading day (2025-12-27), reaching $56.64.
- The 5-day forecast suggests relatively stable prices between 2025-12-27 and 2025-12-31.
- The average confidence interval width is ~5.5% of the predicted price, indicating model uncertainty.
- SIGNAL: Bearish signal, moderate uncertainty.
AI Analysis
For Energy Traders:
The recent neutral sentiment in the market, combined with a decline in the $5.19 for the OPEC Reference Basket, indicates potential bearish pressure on crude prices. The $3.88 Brent-WTI spread suggests that while Brent remains at a premium, the narrowing spread may indicate risk factors related to supply dynamics and geopolitical tensions.
Traders should be cautious of volatility, especially with managed money positioning showing a weakening bullish stance. Key support levels to watch are around $60.00 for WTI and $63.00 for Brent, while resistance may form near $65.00 for Brent and $62.00 for WTI.
For Producers (Oil & Gas Companies):
With the forecast for global oil demand growth remaining stable at about 1.3 mb/d for 2025, producers should consider adjusting production planning accordingly. The slight decrease in 73 tb/d in October from OPEC countries may signal a need for hedging strategies to mitigate potential price declines.
The increase in OECD commercial inventories by 6.0 mb could impact market sentiment, indicating a need for careful monitoring of inventory levels to align production with market demand.
For Consumers (Industrial/Refineries/Transportation):
Consumers should prepare for potential fluctuations in input costs, particularly with WTI and Brent prices showing a bearish trend. The current geopolitical landscape, particularly in relation to supply reliability, poses risks that could affect procurement strategies.
As refining margins have improved, especially for middle distillates, refineries may benefit from procurement strategies that leverage lower crude prices while ensuring supply stability amid ongoing geopolitical tensions.
For Commodity Professionals (Analysts, Consultants):
The Crude Oil market is currently influenced by a combination of stable demand forecasts and bearish sentiment stemming from high inventories and geopolitical uncertainties. The technical indicators indicate a potential for price consolidation, with traders exhibiting a neutral sentiment.
Key driving factors include the supply-demand balance, particularly in non-OECD regions where demand is expected to grow. Analysts should closely monitor shifts in managed money positioning as it may signal upcoming market reversals.
Disclaimer: This analysis is for informational purposes only and should not be construed as financial advice. Always consult with a financial advisor before making investment decisions.