Crude oil is reacting violently to geopolitical developments, yet remains stuck near $57–58 WTI, a level that reflects a market swimming in supply rather than starving for barrels. Venezuela may dominate the news cycle, but it currently produces less than 1 million barrels per day, representing under 1% of global supply, while global balances continue to point toward surplus conditions into 2026. One thing that 2025 taught us is that crude traders are trained to wait for the PROVE IT TO ME phase - headlines that historically moved the market $10 (as the Venezuelan headline would have done in years past), traders now are anticipating that all is normal until proven otherwise. Of course with a military action and removal of Maduro, this can change overnight. For now, 57.35 is the key bull/bear line and I expect it to be fought over. The chart looks weak, but the resilience at 57.35 over the last month gives bulls some hope. This week - all eyes are glued at that bull/bear line. Demand is still a concern and OPEC+ headlines will re-emerge later in the month I expect.
ER
Crude Oil Radar
2026-01-07 00:05
Table of Contents
Brian's Thoughts
Today's Update
Crude oil remains stuck near $57–58 WTI, reflecting an oversupplied market despite geopolitical tensions. Venezuela's production, under 1 million bpd, is a blip on the global radar, contributing to surplus projections extending to 2026. Traders are conditioned to wait for significant market movements, with $57.35 being a pivotal bull/bear line. Demand concerns linger as OPEC+ discussions approach, highlighting the market's delicate balance between supply and geopolitical noise. Keep your eyes peeled for any sudden shifts!
Market Summary
Technical Outlook
Moderately Bearish
Score:
-2/5
Short: SELL
|
Medium: BUY |
Long: SELL
International Prices
Brent:
$61.76
$1.01
WTI:
$58.32
$1.0
Spread:
$3.44
(Brent premium of $3.44)
Key Fundamentals
Crude Stocks:
N/A
(0)
Net Imports:
N/A
(0)
News Sentiment
NEUTRAL
Spec Positioning
Net Position:
15,743
Weekly Change:
4,383
Technical Analysis
Overall Technical Score (-5 to +5):
-2
(Moderately Bearish)
Current Price:
$56.25
Signal:
Moderately Bearish
Moving Averages (9/20)
BULLISH
MA(9): $57.65
MA(20): $57.41
Current Price is 56.25, 9 day MA 57.65, 20 day MA 57.41
MACD (12, 26, 9)
BULLISH
MACD: -0.3894
Signal: -0.4488
Days since crossover: 9
MACD crossed the line 9 days ago and is in a bullish setup
RSI (14)
NEUTRAL
Value: 41.93
Category: NEUTRAL
RSI is 41.93 (note 70% is overbought and 30% is oversold)
Volume (vs 20d Avg)
LOWER
Current: 61,887
Avg (20d): 193,812
Ratio: 0.32
Volume is lower versus 20 day average
Stochastic (14, 3)
BEARISH CROSS
%K: 32.56
%D: 59.4
Stochastic %K: 32.56, %D: 59.4. Signal: bearish cross
ADX (14)
WEAK TREND
ADX: 22.23
+DI: 12.29
-DI: 21.62
ADX: 22.23 (+DI: 12.29, -DI: 21.62). Trend: weak trend
Williams %R (14)
NEUTRAL
Value: -67.44
Williams %R: -67.44 (neutral zone)
Bollinger Bands (20, 2)
BELOW MIDDLE
Upper: 59.35
Middle: 57.41
Lower: 55.48
Price vs BBands (20, 2): below middle. Upper: 59.35, Middle: 57.41, Lower: 55.48
Fundamental Analysis
| Category | Current | Last Week | Last Year | 3 Yr Avg |
|---|---|---|---|---|
| Crude Production (Thousand Barrels a Day) | 13827.0 | 13825.0 | 13585.0 | 12957.67 |
| Crude Imports (Thousand Barrels a Day) | 4953.0 | 6086.0 | 6471.0 | 6511.0 |
| Crude Exports (Thousand Barrels a Day) | 3440.0 | 3616.0 | 3722.0 | 4451.0 |
| Refinery Inputs (Thousand Barrels a Day) | 16847.0 | 16776.0 | 16816.0 | 15785.33 |
| Net Imports (Thousand Barrels a Day) | 1513.0 | 2470.0 | 2749.0 | 2060.0 |
| Commercial Crude Stocks (Thousand Barrels) | 422888.0 | 424822.0 | 416779.0 | 422437.33 |
| Crude & Products Total Stocks (Thousand Barrels) | 1698998.0 | 1688594.0 | 1613783.0 | 1602166.67 |
| Gasoline Stocks (Thousand Barrels) | 234334.0 | 228489.0 | 223667.0 | 230333.33 |
| Distillate Stocks (Thousand Barrels) | 123679.0 | 118702.0 | 116461.0 | 122502.33 |
International Price Analysis
International Price Summary
Brent crude (MAR 26) settled at $61.76, change $+1.01. WTI crude (FEB 26) settled at $58.32, change $+1.0. The Brent-WTI spread is currently $3.44 (Brent premium of $3.44). The Brent-WTI spread reflects differences in global vs. U.S. supply/demand dynamics, geopolitics, and transportation costs.
Brent Crude
$61.76
1.01
(MAR 26)
WTI Crude
$58.32
1.0
(FEB 26)
Brent-WTI Spread
$3.44
Brent premium of $3.44
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 oil market is currently navigating a complex landscape characterized by a slight decline in crude prices and stable global demand growth. OPEC's production decisions will be crucial as the demand for crude from participating countries is projected to rise, albeit at a slower pace than previously anticipated. With a global oil demand forecast of 105.1 mb/d for 2025, the balance between supply and demand remains a focal point for market participants.
Today's Critical Numbers
- World Demand: 105.1 mb/d
- OECD Demand: +0.1 mb/d in 2025
- Non-OECD Demand: +1.2 mb/d in 2025
- China Demand Growth: 4.8% for 2025
- India Demand Growth: 6.5% for 2025
Supply vs Demand Gap Analysis
- Current Gap Size: 42.4 mb/d in 2025
- Regions Driving Deficit: Demand for DoC crude is revised down by 0.1 mb/d
- Implications for OPEC: OPEC may need to adjust production levels to align with the revised demand forecasts.
Regional Powerhouses
- China's Demand Trajectory: Expected to grow by 4.8% in 2025, indicating strong consumption trends.
- India's Growth Story: Projected demand growth of 6.5% for 2025, highlighting its increasing importance in the global oil market.
- Americas' Resilience: The US continues to show strong export capabilities, with crude exports reaching an eight-month high.
- Europe's Challenges: Facing stagnant demand growth, with imports fluctuating due to geopolitical factors.
What's Next
- 2025-2026 Outlook: Global oil demand is forecasted to grow by 1.3 mb/d in 2025 and 1.4 mb/d in 2026.
- Risks and Opportunities: Potential risks include geopolitical tensions affecting supply routes, while opportunities lie in increasing demand from emerging markets.
- Market-Moving Factors: Watch for changes in OPEC production strategies and global economic indicators that could impact demand.
Key Takeaways
- Most Surprising Data Point: The downward revision of demand for DoC crude by 0.1 mb/d.
- Biggest Risk Factor: Geopolitical tensions that could disrupt supply chains.
- Opportunity Area: Increased demand from India and China presents growth opportunities for OPEC producers.
- Strategic Recommendation: OPEC should consider a cautious approach to production adjustments to maintain market stability.
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 and Strengthening
Positioning:
Normal Range
Report Date:
2025-12-30
Managed Money
15,743
Change: +4,383
0.8% of OI
Producer/Merchant
235,605
Change: -9,543
12.4% of OI
Swap Dealers
-305,858
Change: +7,474
-16.1% of OI
Open Interest
1,898,257
Change: 34,714
Summary Analysis:
CFTC Commitment of Traders Report (Disaggregated) as of 2025-12-30
Crude Oil Positioning (WTI-PHYSICAL - NYMEX):
Open Interest: 1,898,257 contracts (+34,714)
Managed Money Net Position: 15,743 contracts (0.8% of OI)
Weekly Change in Managed Money Net: +4,383 contracts
Producer/Merchant Net Position: 235,605 contracts
Swap Dealer Net Position: -305,858 contracts
Market Sentiment (based on Managed Money): Bullish and Strengthening
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
NEUTRAL
Average Polarity:
0.0
Confidence:
1.0
Articles Analyzed:
57
Last Updated:
2026-01-07 00:05:05
Commodity Sentiment
CRUDE_OIL
0.0
Top News Topics
Supply (10 articles)
- Canada Crude Can Compete With Increased Output From Venezuela, PM Carney Says — Market Talk Dow Jones Newswires
- Venezuela Needs Billions in Investment for Oil-Production Growth — Market Talk Dow Jones Newswires
- Crude Rallies as OPEC+ Keeps Output Levels Unchanged in Q1 Barchart
- Venezuelan Oil Output Increase A Longer-Term Prospect — Market Talk Dow Jones Newswires
- Venezuela Remains Contained Risk as Oil Market Focuses on Excess Supply — Market Talk Dow Jones Newswires
- Any Change to Venezuelan Oil Supply Less of a Driver for U.S. Treasurys — Market Talk Dow Jones Newswires
- Venezuela's Oil Won't Add Much to Rising Supply — Market Talk Dow Jones Newswires
- Oil Declines on Oversupply Worries After Maduro's Ouster — Market Talk Dow Jones Newswires
- Long-Term Stability in Venezuela Could Meaningfully Increase Oil Supply — Market Talk Dow Jones Newswires
- Oil prices likely to move higher on Venezuelan turmoil, ample supply to cap gains Reuters
Demand (3 articles)
Infrastructure (2 articles)
Geopolitical (4 articles)
- Oil Edges Lower on Prospects for Relief of Venezuela-Related Sanctions — Market Talk Dow Jones Newswires
- Crude Rallies on Rising Geopolitical Risks Barchart
- Oil Risk Premium Could Rise on Geopolitical Fallout of Maduro Capture — Market Talk Dow Jones Newswires
- U.S. Military Action Not a Reflection of Fundamental Shift in Foreign Policy — Market Talk Dow Jones Newswires
Economic Analysis
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
98.55
Daily:
0.28 (0.29%)
Weekly:
0.31 (0.32%)
US_10Y
4.18
Daily:
0.01 (0.34%)
Weekly:
0.05 (1.19%)
SP500
6944.82
Daily:
42.77 (0.62%)
Weekly:
48.58 (0.7%)
VIX
14.75
Daily:
-0.15 (-1.01%)
Weekly:
0.42 (2.93%)
GOLD
4474.5
Daily:
37.6 (0.85%)
Weekly:
104.4 (2.39%)
COPPER
6.0
Daily:
0.08 (1.34%)
Weekly:
0.28 (4.83%)
Fibonacci Analysis
Current Price:
$56.25
Closest Support:
$54.98
2.26% below current price
Closest Resistance:
$56.78
0.94% above current price
Fibonacci Retracement Levels
0.0
$54.98
Support
0.236
$56.78
Resistance
0.382
$57.89
0.5
$58.78
0.618
$59.68
0.786
$60.96
1.0
$62.59
Fibonacci Extension Levels
1.272
$64.66
1.618
$67.29
2.0
$70.2
2.618
$74.9
ML Price Prediction
Current Price:
$56.26
Forecast Generated:
2026-01-07 00:05:08
Next Trading Day:
UP 0.13%
| Date | Prediction | Lower Bound | Upper Bound |
|---|---|---|---|
| 2026-01-07 | $56.33 | $54.68 | $57.98 |
| 2026-01-08 | $56.26 | $54.61 | $57.91 |
| 2026-01-09 | $56.12 | $54.47 | $57.77 |
| 2026-01-10 | $56.31 | $54.66 | $57.96 |
| 2026-01-11 | $56.39 | $54.74 | $58.04 |
ML Insights
- Forecast generated using ARIMA(5, 1, 0).
- The model predicts a price increase of ~0.13% for the next trading day (2026-01-07), reaching $56.33.
- The 5-day forecast suggests relatively stable prices between 2026-01-07 and 2026-01-11.
- The average confidence interval width is ~5.9% of the predicted price, indicating model uncertainty.
- SIGNAL: Bullish signal, moderate uncertainty.
AI Analysis
For Energy Traders:
The recent price movements indicate a bearish sentiment in the crude oil market, with $65.20/b for the OPEC Reference Basket and $60.07/b for NYMEX WTI, reflecting a downward trend. The Brent-WTI spread at $3.88/b suggests that the market is responding to supply dynamics and geopolitical factors, which may lead to increased volatility. Traders should monitor support levels around $60/b for WTI and $63/b for Brent, while resistance levels could be seen at $65/b and $66/b respectively. Given the managed money positioning with a net long of 15,743 contracts, there may be short-term opportunities for traders to capitalize on potential price corrections or rebounds.
For Producers (Oil & Gas Companies):
The decline in crude prices to an average of $60.07/b signals a need for producers to reassess their production planning. With global oil demand growth forecasted at about 1.3 mb/d for 2025, producers should consider hedging strategies to mitigate risks associated with price volatility. The current inventory levels, with OECD crude oil stocks at 1,331 mb, indicate a slight oversupply relative to demand forecasts, which could pressure prices further. Given the market sentiment and the potential for further inventory builds, strategic adjustments in production and sales strategies may be necessary to maintain profitability.
For Consumers (Industrial/Refineries/Transportation):
With crude oil prices hovering around $60/b, consumers should prepare for potential fluctuations in input costs. The geopolitical tensions and the current inventory levels could impact supply reliability, particularly if sanctions or political instability affect key supply routes. Refineries may benefit from improved refining margins, particularly in the middle distillate sector, but should remain vigilant regarding supply chain disruptions. It may be prudent for consumers to consider procurement strategies that include hedging against price spikes while taking advantage of current price levels for future contracts.
For Commodity Professionals (Analysts, Consultants):
The current Crude Oil market is characterized by a bearish sentiment, with prices declining across major benchmarks. The fundamentals suggest a tightening in the supply-demand balance due to rising production from non-OPEC countries while OPEC production remains stable. The managed money positioning indicates a strengthening bearish trend, with traders holding net long positions, which could signal further downward pressure on prices. Analysts should closely monitor geopolitical developments and inventory trends as they could significantly shift market dynamics. The outlook remains uncertain, with potential shifts depending on global economic performance and OPEC's response to market conditions.
Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Please consult with a financial advisor before making any investment decisions.