Iran built a government agency to control a shipping lane this week and the market somehow spent Tuesday afternoon pretending that was a peace signal. WTI swung $8 in four days — $108.99 on May 15, a -5.66% gut-punch on Wednesday when Trump said "final stages," then a 2% recovery Thursday morning when Tehran's Supreme Leader blocked uranium exports and announced the "Persian Gulf Strait Authority," which is bureaucratic language for "we own this chokepoint now." The physical market never bought the peace trade for a second — international barrels are clearing $30 to $50 above NYMEX because buyers who need actual oil, not futures contracts, are paying whatever it takes to secure a cargo. Goldman has 14.5 million barrels per day curtailed from the Persian Gulf, 500 million barrels already drained from global stockpiles, and a trajectory to 1 billion barrels by June. The IEA says the market stays "severely undersupplied" through October even if the conflict ends next month. The US is holding at 445 million barrels of commercial inventory — only 2% below the 5-year average — but the government pulled a record 10 million barrels from the Strategic Petroleum Reserve last week to get there, and that is a cushion being spent, not a structural fix. $100 is the pivot. A signed framework sends it to $80. Another drone on a Saudi facility sends it to $120 before the close. Until one of those happens, volatility is the only honest trade. Crude ended the week (before Memorial holiday) back down to $96 close to the 97.90 support/resistance line.
ER
Crude Oil Radar
2026-05-25 23:54
Table of Contents
Brian's Thoughts
Today's Update
Crude oil markets are experiencing significant volatility, driven by geopolitical tensions in the Middle East. This week, WTI fluctuated between $108.99 and a -5.66% drop, as Iran established a shipping agency, signaling control over vital trade routes. Despite market perception of peace, physical oil trades reveal buyers are paying premiums, with Goldman predicting a potential 1 billion barrels drained by June. Current prices hover around $96, with $100 as a key pivot; expect further swings based on geopolitical developments and inventory reports.
Market Summary
Technical Outlook
Neutral
Score:
1/5
Short: SELL
|
Medium: SELL |
Long: BUY
International Prices
Brent:
$103.54
$0.96
WTI:
$96.6
$0.25
Spread:
$6.94
(Brent premium of $6.94)
Key Fundamentals
Crude Stocks:
N/A
(0)
Net Imports:
N/A
(0)
News Sentiment
BEARISH
Spec Positioning
Net Position:
98,219
Weekly Change:
25,418
Technical Analysis
Overall Technical Score (-5 to +5):
1
(Neutral)
Current Price:
$91.51
Signal:
Neutral
Moving Averages (9/20)
BULLISH
MA(9): $100.75
MA(20): $100.74
Current Price is 91.51, 9 day MA 100.75, 20 day MA 100.74
MACD (12, 26, 9)
BEARISH
MACD: 0.3215
Signal: 1.5171
Days since crossover: 3
MACD crossed the line 3 days ago and is in a bearish setup
RSI (14)
NEUTRAL
Value: 41.78
Category: NEUTRAL
RSI is 41.78 (note 70% is overbought and 30% is oversold)
Volume (vs 20d Avg)
LOWER
Current: 134,897
Avg (20d): 264,744
Ratio: 0.51
Volume is lower versus 20 day average
Stochastic (14, 3)
BEARISH CROSS
%K: 13.7
%D: 29.6
Stochastic %K: 13.7, %D: 29.6. Signal: bearish cross
ADX (14)
NO TREND
ADX: 15.7
+DI: 18.22
-DI: 29.01
ADX: 15.7 (+DI: 18.22, -DI: 29.01). Trend: no trend
Williams %R (14)
OVERSOLD
Value: -86.3
Williams %R: -86.3 (oversold)
Bollinger Bands (20, 2)
BELOW MIDDLE
Upper: 110.33
Middle: 100.74
Lower: 91.15
Price vs BBands (20, 2): below middle. Upper: 110.33, Middle: 100.74, Lower: 91.15
Fundamental Analysis
| Category | Current | Last Week | Last Year | 3 Yr Avg |
|---|---|---|---|---|
| Crude Production (Thousand Barrels a Day) | 13702.0 | 13710.0 | 13387.0 | 12930.67 |
| Crude Imports (Thousand Barrels a Day) | 6016.0 | 5901.0 | 5841.0 | 6200.67 |
| Crude Exports (Thousand Barrels a Day) | 5604.0 | 5492.0 | 3369.0 | 4262.0 |
| Refinery Inputs (Thousand Barrels a Day) | 16319.0 | 16399.0 | 16401.0 | 16347.0 |
| Net Imports (Thousand Barrels a Day) | 412.0 | 409.0 | 2472.0 | 1938.67 |
| Commercial Crude Stocks (Thousand Barrels) | 445013.0 | 452876.0 | 441830.0 | 452390.33 |
| Crude & Products Total Stocks (Thousand Barrels) | 1601408.0 | 1620349.0 | 1617795.0 | 1610802.33 |
| Gasoline Stocks (Thousand Barrels) | 214163.0 | 215711.0 | 224706.0 | 222873.67 |
| Distillate Stocks (Thousand Barrels) | 102906.0 | 102534.0 | 103553.0 | 108849.33 |
International Price Analysis
International Price Summary
Brent crude (JUL 26) settled at $103.54, change $+0.96. WTI crude (JUL 26) settled at $96.6, change $+0.25. The Brent-WTI spread is currently $6.94 (Brent premium of $6.94). The Brent-WTI spread reflects differences in global vs. U.S. supply/demand dynamics, geopolitics, and transportation costs.
Brent Crude
$103.54
0.96
(JUL 26)
WTI Crude
$96.6
0.25
(JUL 26)
Brent-WTI Spread
$6.94
Brent premium of $6.94
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 saw an increase of $0.83/b, m-o-m, averaging $62.79/b. The Brent–WTI front-month spread rose by $0.71/b, m-o-m, to average $4.47/b.
The forward curves of all major crude benchmarks strengthened, with the front end of the curves for 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 m-o-m. Speculative sentiment turned bullish, with hedge funds and other money managers significantly increasing their net long positions.
World Economy & Macroeconomic Backdrop
The global economic growth forecasts remain stable at 3.1% for 2026 and 3.2% for 2027. The US economic growth forecast has been revised slightly upward to 2.2% for 2026, while it remains at 2% for 2027. The Eurozone's growth forecast is steady at 1.2% for both years, while Japan's forecast remains at 0.9%. China's growth is projected at 4.5% for both years, and India's at 6.6% for 2026 and 6.5% for 2027. Brazil's economic growth is expected to be 2.0% for 2026 and 2.2% for 2027, while Russia's growth forecasts are 1.3% for 2026 and 1.5% for 2027.
Trade normalization and the impacts of monetary policy continue to shape the economic landscape, influencing oil demand and supply dynamics.
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 forecast to grow by approximately 1.2 mb/d. In 2027, global oil demand is projected to grow by about 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.
Key demand drivers include economic recovery in major economies, while constraints may arise from geopolitical tensions and market volatility.
World Oil Supply Analysis
Non-DoC liquids production is forecast to grow by about 0.6 mb/d, y-o-y, in 2026, primarily driven by Brazil, Canada, the US, and Argentina. This trend is expected to continue into 2027. Natural gas liquids (NGLs) and non-conventional liquids from DoC countries are projected to grow by 0.1 mb/d, y-o-y, in both 2026 and 2027. In January, crude oil production from DoC countries decreased by 439 tb/d, m-o-m, to average 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 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 experienced a decline driven by elevated gasoline and jet/kerosene supplies.
Tanker Market & Freight Dynamics
Dirty tanker spot freight rates had a strong start in January, supported by weather disruptions and geopolitical uncertainties. VLCC spot freight rates showed exceptional performance, particularly on the Middle East-to-East route, which saw a 64% increase, y-o-y. Suezmax rates rose amid weather disruptions, while Aframax spot freight rates also performed strongly, reaching a 10-year high. In the clean tanker market, rates were up by 17% m-o-m on the Middle East-to-East route.
Crude & Refined Products Trade Flows
In January, US crude imports averaged 6.3 mb/d, consistent with the latest five-year average, while exports rose by almost 0.2 mb/d, m-o-m, to average 4.2 mb/d. Product exports from the US averaged 7.0 mb/d, down from previous elevated levels. 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 in December, while India's crude imports averaged 5.1 mb/d.
Commercial Stock Movements
Preliminary December 2025 data indicate that OECD commercial oil inventories rose by 6.5 mb, m-o-m, totaling 2,845 mb. This level 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.
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 that of 2025. For 2027, the demand for DoC crude is projected at 43.6 mb/d, also reflecting a 0.6 mb/d increase from 2026. The following table summarizes the supply-demand balance analysis:
| 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 strategic production decisions moving forward. The DoC requirement for 2026 is 43.0 mb/d, while the projected non-DoC supply stands at 63.5 mb/d, indicating a healthy balance in the market.
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:
2026-05-19
Managed Money
98,219
Change: +25,418
4.9% of OI
Producer/Merchant
372,149
Change: +14,742
18.6% of OI
Swap Dealers
-572,558
Change: -19,017
-28.6% of OI
Open Interest
2,002,950
Change: -78,977
Summary Analysis:
CFTC Commitment of Traders Report (Disaggregated) as of 2026-05-19
Crude Oil Positioning (WTI-PHYSICAL - NYMEX):
Open Interest: 2,002,950 contracts (-78,977)
Managed Money Net Position: 98,219 contracts (4.9% of OI)
Weekly Change in Managed Money Net: +25,418 contracts
Producer/Merchant Net Position: 372,149 contracts
Swap Dealer Net Position: -572,558 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
BEARISH
Average Polarity:
-0.6
Confidence:
1.0
Articles Analyzed:
26
Last Updated:
2026-05-25 23:53:30
Commodity Sentiment
CRUDE_OIL
-0.6
Top News Topics
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:
Stable/lower rates may support demand
Risk Sentiment:
Low market volatility/risk appetite
Economic Indicators
USD_INDEX
99.24
Daily:
-0.08 (-0.08%)
Weekly:
-0.06 (-0.06%)
US_10Y
4.56
Daily:
-0.03 (-0.61%)
Weekly:
-0.07 (-1.41%)
SP500
7473.47
Daily:
27.75 (0.37%)
Weekly:
70.42 (0.95%)
VIX
16.59
Daily:
-0.11 (-0.66%)
Weekly:
-1.47 (-8.14%)
GOLD
4542.0
Daily:
21.0 (0.46%)
Weekly:
35.7 (0.79%)
COPPER
6.41
Daily:
0.06 (1.01%)
Weekly:
0.24 (3.91%)
Fibonacci Analysis
Current Price:
$91.51
Closest Support:
$88.41
3.39% below current price
Closest Resistance:
$94.34
3.09% above current price
Fibonacci Retracement Levels
0.0
$69.2
0.236
$81.07
0.382
$88.41
Support
0.5
$94.34
Resistance
0.618
$100.27
0.786
$108.72
1.0
$119.48
Fibonacci Extension Levels
1.272
$133.16
1.618
$150.55
2.0
$169.76
2.618
$200.83
ML Price Prediction
Current Price:
$96.6
Forecast Generated:
2026-05-25 23:53:32
Next Trading Day:
UP 0.23%
| Date | Prediction | Lower Bound | Upper Bound |
|---|---|---|---|
| 2026-05-23 | $96.83 | $88.06 | $105.59 |
| 2026-05-24 | $96.76 | $88.0 | $105.52 |
| 2026-05-25 | $95.94 | $87.18 | $104.71 |
| 2026-05-26 | $95.83 | $87.07 | $104.59 |
| 2026-05-27 | $95.92 | $87.16 | $104.68 |
ML Insights
- Forecast generated using ARIMA(5, 1, 0).
- The model predicts a price increase of ~0.23% for the next trading day (2026-05-23), reaching $96.83.
- The 5-day forecast suggests relatively stable prices between 2026-05-23 and 2026-05-27.
- The average confidence interval width is ~18.2% of the predicted price, indicating model uncertainty.
- SIGNAL: Weak bullish signal, high uncertainty.
AI Analysis
For Energy Traders:
Recent price movements indicate a mixed sentiment in the market. The Brent-WTI spread has widened to $6.94, reflecting differences in global vs. U.S. supply/demand dynamics. With the managed money net position increasing by 25,418 contracts, traders should watch for potential price strength in the near term.
Support levels for WTI are around $60 while resistance is seen at $64. The overall market sentiment remains bearish, with a sentiment score of -0.600. Traders should be cautious of volatility given the recent speculative positioning and consider short-term hedging strategies to mitigate risks.
For Producers (Oil & Gas Companies):
The current inventory levels indicate a slight increase in crude stocks, which may affect production planning. The DoC crude demand remains stable at 43.0 mb/d for 2026, suggesting a steady market for producers. Given the increased net long positions among speculators, producers may consider hedging strategies to lock in prices amidst potential volatility.
The decline in refining margins could impact profitability, emphasizing the need for operational efficiencies. Producers should also monitor geopolitical factors that could disrupt supply chains and influence market sentiment.
For Consumers (Industrial/Refineries/Transportation):
Consumers should brace for potential input cost fluctuations as crude prices remain volatile, particularly with WTI and Brent prices at $60.26 and $64.73, respectively. The supply reliability risks due to geopolitical tensions and inventory changes should be factored into procurement strategies.
It is advisable to consider hedging options to mitigate the impact of rising costs, especially in light of the bearish market sentiment reflected in recent news articles. Monitoring global demand forecasts will also be crucial in planning future procurement.
For Commodity Professionals (Analysts, Consultants):
The Crude Oil market is currently experiencing a bearish sentiment with a sentiment score of -0.600. Key driving factors include stable global demand forecasts and a slight increase in inventory levels, which could signal a shift in market dynamics. The managed money positioning indicates potential price strength, but caution is warranted given the declining refining margins and geopolitical uncertainties.
Analysts should keep an eye on the balance of supply and demand, particularly the stable demand for DoC crude, and the implications of the widening Brent-WTI spread. The interplay between these factors will be crucial in forecasting potential outlook shifts in the crude oil market.
Disclaimer: This analysis is for informational purposes only and does not