Everything and I mean EVERYTHING is about the Strait of Hormuz - almost no one knew about the constraint point before the US attacked Iran - but now every news outlet talks about it all the time. Supply out of the Middle East is down about 9 mmbpd in April (May’s numbers will lag). Physical barrels are priced higher $120-150 while Peace would lead to $80. So traders have it priced “about right” with WTI at $100 and Brent over $109. Everything is about headlines right now and the latest ones indicate that there is a consensus expectation that flow through the Strait of Hormuz will start up again in June….IEA indicated that even if flows resume - we will be short barrels through October.
ER
Crude Oil Radar
2026-05-16 23:52
Table of Contents
Brian's Thoughts
Today's Update
Crude oil markets are in a tight spot, primarily due to disruptions through the Strait of Hormuz, leading to a significant supply drop of about 9 million bpd in April. Current prices hover around $100 for WTI and over $109 for Brent, reflecting heightened inventory concerns and geopolitical tensions. With the consensus anticipating a resumption of flow in June, the IEA warns of ongoing barrel shortages through October. Traders should keep an eye on headlines — they may just dictate the market's next moves!
Market Summary
Technical Outlook
Moderately Bullish
Score:
3/5
Short: BUY
|
Medium: BUY |
Long: BUY
International Prices
Brent:
$109.26
$3.54
WTI:
$105.42
$4.25
Spread:
$3.84
(Brent premium of $3.84)
Key Fundamentals
Crude Stocks:
N/A
(0)
Net Imports:
N/A
(0)
News Sentiment
NEUTRAL
Spec Positioning
Net Position:
72,801
Weekly Change:
2,010
Technical Analysis
Overall Technical Score (-5 to +5):
3
(Moderately Bullish)
Current Price:
$105.42
Signal:
Moderately Bullish
Moving Averages (9/20)
BULLISH
MA(9): $99.49
MA(20): $98.85
Current Price is 105.42, 9 day MA 99.49, 20 day MA 98.85
MACD (12, 26, 9)
BULLISH
MACD: 1.93
Signal: 1.7581
Days since crossover: 1
MACD crossed the line 1 days ago and is in a bullish setup
RSI (14)
NEUTRAL
Value: 58.45
Category: NEUTRAL
RSI is 58.45 (note 70% is overbought and 30% is oversold)
Volume (vs 20d Avg)
LOWER
Current: 173,862
Avg (20d): 280,765
Ratio: 0.62
Volume is lower versus 20 day average
Stochastic (14, 3)
BULLISH CROSS
%K: 75.26
%D: 62.31
Stochastic %K: 75.26, %D: 62.31. Signal: bullish cross
ADX (14)
NO TREND
ADX: 16.16
+DI: 24.21
-DI: 19.5
ADX: 16.16 (+DI: 24.21, -DI: 19.5). Trend: no trend
Williams %R (14)
NEUTRAL
Value: -24.74
Williams %R: -24.74 (neutral zone)
Bollinger Bands (20, 2)
ABOVE MIDDLE
Upper: 108.75
Middle: 98.85
Lower: 88.95
Price vs BBands (20, 2): above middle. Upper: 108.75, Middle: 98.85, Lower: 88.95
Fundamental Analysis
| Category | Current | Last Week | Last Year | 3 Yr Avg |
|---|---|---|---|---|
| Crude Production (Thousand Barrels a Day) | 13710.0 | 13573.0 | 13367.0 | 12895.67 |
| Crude Imports (Thousand Barrels a Day) | 5901.0 | 5477.0 | 6056.0 | 6481.67 |
| Crude Exports (Thousand Barrels a Day) | 5492.0 | 4750.0 | 4006.0 | 3938.0 |
| Refinery Inputs (Thousand Barrels a Day) | 16399.0 | 16029.0 | 16071.0 | 16215.33 |
| Net Imports (Thousand Barrels a Day) | 409.0 | 727.0 | 2050.0 | 2543.67 |
| Commercial Crude Stocks (Thousand Barrels) | 452876.0 | 457182.0 | 438376.0 | 455491.33 |
| Crude & Products Total Stocks (Thousand Barrels) | 1620349.0 | 1634013.0 | 1612398.0 | 1610181.0 |
| Gasoline Stocks (Thousand Barrels) | 215711.0 | 219795.0 | 225728.0 | 223601.0 |
| Distillate Stocks (Thousand Barrels) | 102534.0 | 102344.0 | 106708.0 | 108717.0 |
International Price Analysis
International Price Summary
Brent crude (JUL 26) settled at $109.26, change $+3.54. WTI crude (JUN 26) settled at $105.42, change $+4.25. The Brent-WTI spread is currently $3.84 (Brent premium of $3.84). The Brent-WTI spread reflects differences in global vs. U.S. supply/demand dynamics, geopolitics, and transportation costs.
Brent Crude
$109.26
3.54
(JUL 26)
WTI Crude
$105.42
4.25
(JUN 26)
Brent-WTI Spread
$3.84
Brent premium of $3.84
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 January, the OPEC Reference Basket (ORB) value rose by $0.61/b, month-on-month (m-o-m), to average $62.31/b. The ICE Brent front-month contract increased by $3.10/b, m-o-m, to average $64.73/b, while the NYMEX WTI front-month contract rose by $2.39/b, m-o-m, to average $60.26/b. The GME Oman front-month contract also experienced a rise of $0.83/b, m-o-m, averaging $62.79/b. The Brent–WTI front-month spread increased by $0.71/b, m-o-m, to average $4.47/b.
The forward curves for all major crude benchmarks strengthened, with both ICE Brent and NYMEX WTI moving into stronger backwardation. This shift was supported by oil supply outages, easing selling pressure from speculators, and robust physical market fundamentals. The forward curve for GME Oman remained relatively unchanged. Speculative sentiment turned bullish, with hedge funds and other money managers sharply increasing their net long positions.
World Economy & Macroeconomic Backdrop
The global economic growth forecasts remain unchanged from last month’s assessment at 3.1% for 2026 and 3.2% for 2027. The US economic growth forecast has been revised slightly up to 2.2% for 2026, while remaining at 2% for 2027. The Eurozone's economic growth forecasts remain at 1.2% for both years. Japan's growth forecasts are steady at 0.9%, and China's growth is projected at 4.5% for both years. India's growth outlook stands at 6.6% for 2026 and 6.5% for 2027. Brazil's growth is forecasted at 2.0% for 2026 and 2.2% for 2027, while Russia's economic growth is expected to be 1.3% in 2026 and 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 OECD is expected to increase by 0.15 mb/d, while the non-OECD is forecasted to grow by about 1.2 mb/d. For 2027, global oil demand is projected to grow by approximately 1.3 mb/d, y-o-y, with the OECD growing by 0.1 mb/d and the non-OECD increasing by about 1.2 mb/d.
World Oil Supply Analysis
Non-DoC liquids production is forecasted to grow by about 0.6 mb/d, y-o-y, in 2026, driven primarily by Brazil, Canada, the US, and Argentina. This growth is expected to continue into 2027. Natural gas liquids (NGLs) and non-conventional liquids from DoC countries are forecasted to grow by 0.1 mb/d, y-o-y, in both 2026 and 2027. In January, crude oil production by DoC countries decreased by 439 tb/d, m-o-m, averaging about 42.45 mb/d.
Product Markets & Refining Operations
In January, refining margins declined across all reported trading hubs due to stronger feedstock prices and seasonal demand-side pressures. In the US Gulf Coast, losses were attributed to increased availability of heavy crude supplies affecting fuel oil and gasoil crack spreads. In Rotterdam, all key product margins fell, with gasoline leading the decline. Singapore also saw a decline driven by elevated gasoline and jet/kerosene supplies.
Tanker Market & Freight Dynamics
Dirty tanker spot freight rates had a robust start in January, supported by weather disruptions and geopolitical uncertainties. VLCC spot freight rates reached a decade-high for the month, increasing by 64%, y-o-y. Suezmax rates also rose due to weather disruptions, with rates on the USGC-to-Europe route up by 12%, m-o-m. Aframax spot freight rates experienced a strong performance, with cross-Med Aframax rates rising by 10%, m-o-m. In the clean tanker market, rates on the Middle East-to-East route increased by 17%, m-o-m.
Crude & Refined Products Trade Flows
In January, US crude imports averaged 6.3 mb/d, consistent with the five-year average, while crude exports rose to 4.2 mb/d. Product exports from the US averaged 7.0 mb/d, down from previous months. In Japan, crude imports surged to just under 3 mb/d, the highest since March 2020. China's crude imports reached a record high of 13.2 mb/d, while India's crude imports remained elevated at 5.1 mb/d.
Commercial Stock Movements
Preliminary December data indicate that OECD commercial oil inventories rose by 6.5 mb, m-o-m, to 2,845 mb, which is 89.9 mb higher, y-o-y, and 44.1 mb above the latest five-year average. Crude stocks fell by 2.1 mb, while product stocks increased by 8.6 mb. OECD crude oil commercial stocks stood at 1,363 mb, which is 75.5 mb higher, y-o-y, and 17.5 mb above the latest five-year average.
Supply-Demand Balance & Market Outlook
The demand for DoC crude in 2026 remains at 43.0 mb/d, which is about 0.6 mb/d higher than in 2025. For 2027, the demand remains at 43.6 mb/d, also reflecting a 0.6 mb/d increase. The supply-demand gap analysis indicates a significant requirement for DoC crude to meet the projected world demand.
| 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 clear gap between world demand and non-DoC supply, necessitating strategic production decisions to ensure market balance.
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:
2026-05-12
Managed Money
72,801
Change: +2,010
3.5% of OI
Producer/Merchant
357,407
Change: +19,906
17.2% of OI
Swap Dealers
-553,541
Change: -9,890
-26.6% of OI
Open Interest
2,081,927
Change: 14,100
Summary Analysis:
CFTC Commitment of Traders Report (Disaggregated) as of 2026-05-12
Crude Oil Positioning (WTI-PHYSICAL - NYMEX):
Open Interest: 2,081,927 contracts (+14,100)
Managed Money Net Position: 72,801 contracts (3.5% of OI)
Weekly Change in Managed Money Net: +2,010 contracts
Producer/Merchant Net Position: 357,407 contracts
Swap Dealer Net Position: -553,541 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:
56
Last Updated:
2026-05-16 23:52:12
Commodity Sentiment
CRUDE_OIL
0.0
Top News Topics
Supply (4 articles)
- U.S. Diesel Exports Defy Low Inventory Concerns — Market Talk Dow Jones Newswires
- Oil ends flat as tanker crossings through Strait of Hormuz temper supply fears Reuters
- Oil Firms as Supply Tightness Persists Trading Economics
- WTI Firms as Supply Tightness Persists Trading Economics
Demand (2 articles)
- U.S. Diesel Exports Defy Low Inventory Concerns — Market Talk Dow Jones Newswires
- Low-Income Countries Most Vulnerable to Lost Oil Demand — Market Talk Dow Jones Newswires
Infrastructure (1 articles)
Economic Analysis
Economic Sentiment Summary
NEGATIVE - Economic indicators showing headwinds
Dollar Impact:
Strong USD may pressure commodity prices
Industrial Demand:
Weaker industrial demand signals
Interest Rate Impact:
Rising rates may impact energy demand
Risk Sentiment:
Low market volatility/risk appetite
Economic Indicators
USD_INDEX
99.27
Daily:
0.39 (0.39%)
Weekly:
1.33 (1.36%)
US_10Y
4.59
Daily:
0.13 (3.0%)
Weekly:
0.18 (4.2%)
SP500
7408.5
Daily:
-92.74 (-1.24%)
Weekly:
-4.34 (-0.06%)
VIX
18.43
Daily:
1.17 (6.78%)
Weekly:
0.05 (0.27%)
GOLD
4555.8
Daily:
-122.3 (-2.61%)
Weekly:
-162.9 (-3.45%)
COPPER
6.25
Daily:
-0.32 (-4.81%)
Weekly:
-0.16 (-2.53%)
Fibonacci Analysis
Current Price:
$105.42
Closest Support:
$98.13
6.92% below current price
Closest Resistance:
$107.52
1.99% above current price
Fibonacci Retracement Levels
0.0
$63.6
0.236
$76.79
0.382
$84.95
0.5
$91.54
0.618
$98.13
Support
0.786
$107.52
Resistance
1.0
$119.48
Fibonacci Extension Levels
1.272
$134.68
1.618
$154.01
2.0
$175.36
2.618
$209.89
ML Price Prediction
Current Price:
$105.42
Forecast Generated:
2026-05-16 23:52:15
Next Trading Day:
DOWN 0.16%
| Date | Prediction | Lower Bound | Upper Bound |
|---|---|---|---|
| 2026-05-16 | $105.26 | $94.66 | $115.85 |
| 2026-05-17 | $105.31 | $94.72 | $115.9 |
| 2026-05-18 | $105.4 | $94.81 | $116.0 |
| 2026-05-19 | $105.35 | $94.76 | $115.94 |
| 2026-05-20 | $105.7 | $95.1 | $116.29 |
ML Insights
- Forecast generated using ARIMA(5, 1, 0).
- The model predicts a price decrease of ~0.16% for the next trading day (2026-05-16), reaching $105.26.
- The 5-day forecast suggests relatively stable prices between 2026-05-16 and 2026-05-20.
- The average confidence interval width is ~20.1% of the predicted price, indicating model uncertainty.
- SIGNAL: Weak bearish signal, high uncertainty.
AI Analysis
For Energy Traders:
The recent price movements indicate a bullish sentiment in the crude oil market, with the Brent and WTI benchmarks both showing significant month-on-month increases. The Brent-WTI spread has widened to $4.47/b, suggesting that the market dynamics favor Brent due to tighter supply conditions globally compared to the U.S.
Traders should watch for potential support levels around the $60/b mark for WTI and $62/b for Brent, while resistance could be observed at $65/b for Brent. The risk factors include geopolitical tensions and changes in inventory levels, which could introduce volatility in the short term.
Overall, the convergence of bullish sentiment, tightening supply fundamentals, and increased speculative positions suggests that traders may find short-term opportunities in the market, particularly if the current conditions hold.
For Producers (Oil & Gas Companies):
The current market conditions necessitate a reassessment of production planning and hedging strategies. With OPEC production cuts resulting in a decrease of 439 tb/d in January, producers should consider the implications of reduced supply on pricing and potential profitability.
The increase in OECD commercial oil inventories by 6.5 mb indicates a slight oversupply, which may impact pricing in the near term. However, the market sentiment is strengthening, driven by a balance of supply and demand that favors producers in the medium term.
Producers should remain agile and monitor inventory levels closely, as fluctuations in crude and product stocks could influence operational strategies and market positioning.
For Consumers (Industrial/Refineries/Transportation):
Consumers should prepare for potential input cost fluctuations in crude oil, particularly as WTI and Brent prices continue to rise. The recent increases in Brent to $64.73/b and WTI to $60.26/b could lead to higher procurement costs for refineries and transportation sectors.
Additionally, geopolitical uncertainties and fluctuating supply reliability—exemplified by recent disruptions in tanker routes—pose risks to supply chains. As such, consumers should evaluate their procurement strategies and consider hedging options to mitigate exposure to rising prices and supply disruptions.
For Commodity Professionals (Analysts, Consultants):
The Crude Oil market is currently influenced by a mix of bullish fundamentals and bearish technicals. The sustained demand growth forecast of 1.4 mb/d for 2026 coupled with 0.6 mb/d supply growth from non-OPEC sources indicates a tightening market.
Analysts should note the balance of supply and demand remains precarious, with OPEC's production cuts impacting overall output.