Crude traders wake up to a market that has decisively shifted from spreadsheet-watching to risk-pricing. WTI ~$65 and Brent ~$70 are sitting on the strongest weekly gains since October after price cleanly broke $61.64, opening a technical runway toward $66.84. The driver is not demand euphoria. It’s supply anxiety. The U.S. has expanded its military presence around Iran, reviving tail-risk chatter around disruptions tied to the Strait of Hormuz, which moves roughly 30% of global crude flows. At the same time, Russia all but dismissed near-term peace prospects with Ukraine, keeping sanctions pressure and export friction firmly in place. Add in ~10% U.S. production shut-ins from Winter Storm Fern and suddenly near-term balances look tighter, even as the IEA trimmed its 2026 surplus to ~3.7 MMBPD (although this is still massive). U.S. crude inventories are running ~3% below the 5-year average, floating storage slipped to ~113 MMbbl, and OPEC+ remains cautious, still holding back roughly 1.2 MMBPD despite restoring some cuts. The counterweight is demand. The EIA cut 2026 U.S. consumption, gasoline and distillate stocks remain above seasonal norms (Gasoline is MEGA bearish on stocks and Distillates are just slightly bearish on stocks), and the dollar has firmed. Translation: this rally is being powered by fear and positioning, not barrels being burned. If geopolitics escalate, $66.84 is in play quickly. If rhetoric cools and demand stays soft, this move risks stalling just as fast. For now, trend is up, conviction is rising, and the market is trading headlines with real mass behind them.
* Do we retrace down to $61.64 or finally test $66.84
* Iran seems to be the only key to bull/bear right now
* Fundamentals are pointed very bearish unless supply gets disrupted.
ER
Crude Oil Radar
2026-02-01 23:54
Table of Contents
Brian's Thoughts
Today's Update
Crude oil traders are navigating a market shift from spreadsheets to risk-pricing, with WTI around $65 and Brent near $70, marking the strongest weekly gains since October. The surge stems from supply anxiety amid rising tensions in Iran and ongoing disruptions from the Winter Storm Fern, which has led to ~10% U.S. production shut-ins. Despite bullish sentiment, underlying fundamentals remain bearish, with the IEA projecting a 2026 surplus. Watch for geopolitical developments; they could quickly push prices toward $66.84 or stall momentum.
Market Summary
Technical Outlook
Neutral
Score:
1/5
Short: BUY
|
Medium: BUY |
Long: BUY
International Prices
Brent:
$70.69
$0.02
WTI:
$65.21
$0.21
Spread:
$5.48
(Brent premium of $5.48)
Key Fundamentals
Crude Stocks:
N/A
(0)
Net Imports:
N/A
(0)
News Sentiment
BULLISH
Spec Positioning
Net Position:
59,047
Weekly Change:
11,547
Technical Analysis
Overall Technical Score (-5 to +5):
1
(Neutral)
Current Price:
$65.55
Signal:
Neutral
Moving Averages (9/20)
BULLISH
MA(9): $62.07
MA(20): $60.28
Current Price is 65.55, 9 day MA 62.07, 20 day MA 60.28
MACD (12, 26, 9)
BULLISH
MACD: 1.525
Signal: 0.9058
Days since crossover: 26
MACD crossed the line 26 days ago and is in a bullish setup
RSI (14)
NEUTRAL
Value: 69.22
Category: NEUTRAL
RSI is 69.22 (note 70% is overbought and 30% is oversold)
Volume (vs 20d Avg)
LOWER
Current: 219,872
Avg (20d): 321,782
Ratio: 0.68
Volume is lower versus 20 day average
Stochastic (14, 3)
OVERBOUGHT
%K: 88.42
%D: 90.58
Stochastic %K: 88.42, %D: 90.58. Signal: overbought
ADX (14)
STRONG UPTREND
ADX: 32.68
+DI: 29.75
-DI: 6.58
ADX: 32.68 (+DI: 29.75, -DI: 6.58). Trend: strong uptrend
Williams %R (14)
OVERBOUGHT
Value: -11.58
Williams %R: -11.58 (overbought)
Bollinger Bands (20, 2)
BREAKOUT UPPER
Upper: 65.25
Middle: 60.28
Lower: 55.3
Price vs BBands (20, 2): breakout upper. Upper: 65.25, Middle: 60.28, Lower: 55.3
Fundamental Analysis
| Category | Current | Last Week | Last Year | 3 Yr Avg |
|---|---|---|---|---|
| Crude Production (Thousand Barrels a Day) | 13696.0 | 13732.0 | 13477.0 | 12813.33 |
| Crude Imports (Thousand Barrels a Day) | 5642.0 | 6447.0 | 6745.0 | 6445.33 |
| Crude Exports (Thousand Barrels a Day) | 4589.0 | 3688.0 | 4515.0 | 3690.67 |
| Refinery Inputs (Thousand Barrels a Day) | 16209.0 | 16604.0 | 15522.0 | 14999.33 |
| Net Imports (Thousand Barrels a Day) | 1053.0 | 2759.0 | 2230.0 | 2754.67 |
| Commercial Crude Stocks (Thousand Barrels) | 423754.0 | 426049.0 | 411663.0 | 429908.67 |
| Crude & Products Total Stocks (Thousand Barrels) | 1715851.0 | 1722117.0 | 1621794.0 | 1601425.0 |
| Gasoline Stocks (Thousand Barrels) | 257213.0 | 256990.0 | 245898.0 | 245862.33 |
| Distillate Stocks (Thousand Barrels) | 132921.0 | 132592.0 | 128945.0 | 124112.0 |
International Price Analysis
International Price Summary
Brent crude (MAR 26) settled at $70.69, change $-0.02. WTI crude (MAR 26) settled at $65.21, change $-0.21. The Brent-WTI spread is currently $5.48 (Brent premium of $5.48). The Brent-WTI spread reflects differences in global vs. U.S. supply/demand dynamics, geopolitics, and transportation costs.
Brent Crude
$70.69
0.02
(MAR 26)
WTI Crude
$65.21
0.21
(MAR 26)
Brent-WTI Spread
$5.48
Brent premium of $5.48
OPEC Analysis
Supply-Demand Balance
China Oil Demand Trend
India Oil Demand Trend
United States Oil Demand Trend
Year-over-Year Market Analysis
OPEC Countries Production
Data Sources Used:
Supply Balance
China Data
India Data
US Data
World Demand
105.14
mb/d
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
Crude Oil Price Movements
In December, the OPEC Reference Basket (ORB) value dropped by $2.72/b, month-on-month (m-o-m), to average $61.74/b. The ICE Brent front-month contract dropped by $2.03/b, m-o-m, to average $61.63/b, while the NYMEX WTI front-month contract fell by $1.61/b, m-o-m, to average $57.87/b. The GME Oman front-month contract also decreased by $2.57/b, m-o-m, to average $61.96/b. The Brent–WTI front-month spread narrowed by $0.42/b, m-o-m, to average $3.76/b in December.
The forward curves of all major crude benchmarks remained in backwardation in December, indicating supportive physical crude market fundamentals and a positive short-term global supply–demand outlook. Despite persistent selling pressure in futures markets, the forward curves for ICE Brent and GME Oman flattened further, while the backwardation in NYMEX WTI strengthened slightly.
World Economy & Macroeconomic Backdrop
Global economic growth is forecast at 3.1% in 2026, unchanged from last month’s assessment, with an acceleration to 3.2% expected in 2027. This positive outlook is supported by normalization in global trade, fiscal support measures, and adjustments to monetary policies in major economies. Key forecasts include:
- US: 2.1% growth in 2026, 2.0% in 2027
- Eurozone: 1.2% growth in both 2026 and 2027
- Japan: 0.9% growth in both 2026 and 2027
- China: 4.5% growth in both 2026 and 2027
- India: 6.6% growth in 2026, 6.5% in 2027
- Brazil: 2.0% growth in 2026, rising to 2.2% in 2027
- Russia: 1.3% growth in 2026, increasing to 1.5% in 2027
World Oil Demand Trends
The global oil demand growth forecast for 2026 remains at 1.4 mb/d, y-o-y, unchanged from last month’s assessment. The breakdown is as follows:
- OECD: growth of 0.15 mb/d
- Non-OECD: growth of approximately 1.2 mb/d
For 2027, global oil demand is forecast to grow by about 1.3 mb/d, with the OECD expected to grow by 0.1 mb/d and the non-OECD by around 1.2 mb/d.
World Oil Supply Analysis
Non-DoC liquids production in 2026 is forecast to grow by about 0.6 mb/d, with Brazil, Canada, the US, and Argentina as the main growth drivers. The outlook for 2027 remains similar, with a continued growth of 0.6 mb/d. Key insights include:
- Natural gas liquids (NGLs) and non-conventional liquids from DoC countries are forecast to grow by 0.1 mb/d in both 2026 and 2027.
- Crude oil production by DoC countries decreased by 238 tb/d in December, averaging about 42.83 mb/d.
Product Markets & Refining Operations
Refining margins dropped across all regions in December, following a sharp upward trend in previous months. Key factors include:
- Product inventory builds, particularly for transport fuels, amid seasonal demand pressures.
- Decline in European product flows to West Africa.
- In Southeast Asia, rising domestic product supplies and firm availability from the Middle East impacted refining profitability.
Tanker Market & Freight Dynamics
Dirty tanker spot freight rates declined in December, following strong gains earlier in the year. Notable trends include:
- VLCC spot freight rates dropped but remained strong due to continued demand for long-haul flows.
- Spot freight rates on the Middle East-to-East route declined by 12%, while rates on the Middle East-to-West route fell by 11%.
- Suezmax rates also saw a decline, with rates on the US Gulf Coast to Europe route down by 12%.
- Aframax rates experienced a more moderate decline of 4% on the Cross-Med route.
- In the clean tanker market, rates rose by 14% on the Middle East-to-East route and 6% around the Mediterranean.
Crude & Refined Products Trade Flows
In December, US crude imports were stable at just under 6 mb/d, while crude exports increased by nearly 10%. Key trade flow insights include:
- OECD Europe saw an increase in crude imports, while product imports declined.
- Japan's crude imports rose to an average of 2.4 mb/d, supported by regional demand.
- China's crude imports surged to 12.4 mb/d, a gain of around 9%, following quota releases.
- India's crude imports remained robust, averaging 5.1 mb/d, with increased product exports.
Commercial Stock Movements
Preliminary data for November 2025 indicate that OECD commercial inventories rose by 4.0 mb, m-o-m, to 2,840 mb. Key observations include:
- OECD commercial stocks were 77.6 mb higher than a year earlier but 101.5 mb below the 2015–2019 average.
- Crude stocks rose by 8.1 mb, while product stocks fell by 4.1 mb.
- Days of forward cover increased by 0.2 days, m-o-m, to 62.2 days.
Supply-Demand Balance & Market Outlook
Demand for DoC crude in 2026 is forecast at 43.0 mb/d, about 0.6 mb/d higher than in 2025, with an increase to 43.6 mb/d expected in 2027. The supply-demand balance analysis is as follows:
| Year | World Demand (mb/d) | Non-DoC Supply (mb/d) | DoC Requirement (mb/d) |
|---|---|---|---|
| 2026 | 106.5 | 63.5 | 43.0 |
| 2027 | 107.9 | 64.3 | 43.6 |
The analysis indicates a supply-demand gap that necessitates a strategic outlook for production decisions moving forward.
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:
2026-01-27
Managed Money
59,047
Change: +11,547
2.9% of OI
Producer/Merchant
192,338
Change: -12,099
9.4% of OI
Swap Dealers
-307,386
Change: -5,902
-15.1% of OI
Open Interest
2,035,649
Change: 71,290
Summary Analysis:
CFTC Commitment of Traders Report (Disaggregated) as of 2026-01-27
Crude Oil Positioning (WTI-PHYSICAL - NYMEX):
Open Interest: 2,035,649 contracts (+71,290)
Managed Money Net Position: 59,047 contracts (2.9% of OI)
Weekly Change in Managed Money Net: +11,547 contracts
Producer/Merchant Net Position: 192,338 contracts
Swap Dealer Net Position: -307,386 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
BULLISH
Average Polarity:
0.65
Confidence:
1.0
Articles Analyzed:
35
Last Updated:
2026-02-01 23:53:12
Commodity Sentiment
CRUDE_OIL
0.65
Top News Topics
Supply (1 articles)
- Oil Prices Can Stay High Despite Oversupply — Market Talk Dow Jones Newswires
Weather (1 articles)
- New England Relied on Petroleum-Fired Generation During Storm — 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
97.14
Daily:
0.15 (0.16%)
Weekly:
0.92 (0.96%)
US_10Y
4.24
Daily:
0.01 (0.33%)
Weekly:
0.03 (0.66%)
SP500
6939.03
Daily:
-29.98 (-0.43%)
Weekly:
-11.2 (-0.16%)
VIX
17.44
Daily:
0.56 (3.32%)
Weekly:
1.29 (7.99%)
GOLD
5067.5
Daily:
-250.9 (-4.72%)
Weekly:
-12.2 (-0.24%)
COPPER
6.01
Daily:
-0.16 (-2.6%)
Weekly:
0.03 (0.52%)
Fibonacci Analysis
Current Price:
$65.55
Closest Support:
$64.02
2.33% below current price
Closest Resistance:
$66.48
1.42% above current price
Fibonacci Retracement Levels
0.0
$54.98
0.236
$57.69
0.382
$59.37
0.5
$60.73
0.618
$62.09
0.786
$64.02
Support
1.0
$66.48
Resistance
Fibonacci Extension Levels
1.272
$69.61
1.618
$73.59
2.0
$77.98
2.618
$85.09
ML Price Prediction
Current Price:
$65.55
Forecast Generated:
2026-02-01 23:53:14
Next Trading Day:
DOWN 0.1%
| Date | Prediction | Lower Bound | Upper Bound |
|---|---|---|---|
| 2026-01-31 | $65.48 | $63.21 | $67.76 |
| 2026-02-01 | $65.37 | $63.09 | $67.65 |
| 2026-02-02 | $65.1 | $62.83 | $67.38 |
| 2026-02-03 | $65.01 | $62.74 | $67.29 |
| 2026-02-04 | $65.0 | $62.73 | $67.28 |
ML Insights
- Forecast generated using ARIMA(5, 1, 0).
- The model predicts a price decrease of ~0.10% for the next trading day (2026-01-31), reaching $65.48.
- The 5-day forecast suggests relatively stable prices between 2026-01-31 and 2026-02-04.
- The average confidence interval width is ~7.0% of the predicted price, indicating model uncertainty.
- SIGNAL: Bearish signal, moderate uncertainty.
AI Analysis
For Energy Traders:
The recent drop in crude oil prices, with the $61.74/b average for the OPEC Reference Basket and the $61.63/b average for ICE Brent, indicates potential bearish sentiment in the short term. The $3.76/b Brent-WTI spread suggests that the market is reacting to differing dynamics between global and U.S. supply, which could create volatility in trading strategies.
The backwardation in forward curves signals supportive physical market fundamentals, which may provide support levels around $57/b for WTI. However, traders should remain cautious as the current sentiment could indicate further price fluctuations.
Short-term opportunities may arise from the managed money positioning, which has increased net long positions, indicating a potential for price recovery if market sentiment shifts positively.
For Producers (Oil & Gas Companies):
The decrease in $238 tb/d in crude oil production from OPEC countries in December highlights the need for careful production planning. With global oil demand growth forecasted at 1.4 mb/d for 2026, producers should consider balancing supply to meet demand efficiently while navigating the bearish sentiment in pricing.
The increase in commercial crude stocks by 8.1 mb suggests a potential oversupply, impacting hedging strategies. Producers may need to evaluate their hedging positions to mitigate risks associated with fluctuating inventory levels and market sentiment.
For Consumers (Industrial/Refineries/Transportation):
The recent fluctuations in crude prices, with WTI settling at $57.87/b, could lead to potential input cost increases. Consumers should be prepared for supply reliability risks due to geopolitical factors and inventory levels, particularly as U.S. crude imports remain stable at just under 6 mb/d.
The procurement strategies should account for potential price volatility, especially with the recent increase in crude exports by 10% in December. This could impact availability and pricing of refined products in the market.
For Commodity Professionals (Analysts, Consultants):
The current Crude Oil market landscape shows a complex interplay of factors. The bullish sentiment indicated by the managed money positioning, with an increase of 11,547 contracts, suggests potential upward price movement. However, the declining refining margins and rising inventories present risks that could counteract this momentum.
The forecasted global oil demand growth of 1.4 mb/d juxtaposed with the increase in non-DoC liquids production underscores a fundamental balance that analysts should monitor closely. The combination of these factors may lead to shifts in market outlook, necessitating continuous analysis of both technical and fundamental indicators.
Disclaimer: This analysis is for informational purposes only and does not constitute financial advice or specific buy/sell recommendations.