WTI completes the lap back down, eyes on EIA, Trump’s response
- WTI reverses Iran’s strike-led surge rally to multi-month highs.
- Iran’s de-escalation hopes, secured Iraqi facilities calm markets.
- Markets await Trump’s response, EIA data for fresh direction in oil.
WTI (oil futures on NYMEX) almost completes a lap and trades below the $63 mark in the European session, having reversed the solid upsurge to fresh 8.5-month highs of $65.65.
The prices have returned to the levels seen before Iran’s retaliatory attacks against the US’ airstrike on Quds Force Commander Soleimani in Iraq last Friday. Iran, in early hours of Wednesday, fired more than a dozen missiles on the US airbases in Iraq, as confirmed by the military from both sides.
The black gold jumped nearly $3 in a knee-jerk reaction to the news, although failed to hold at higher levels following restrained response from the US and hopes of de-escalation from Iran. US President Trump’s tweet hinted negligible damage caused by the strike while Iran’s Foreign Minister Zarif said Iran does not seek escalation of war. These conciliatory tweets from both sides calm the markets.
Further, comments from the OPEC Secretary-General Barkindo, stating the Iraqi oil facilities are secured and that the production is continuing also eased fears of oil supply disruption, which in turn also collaborated with the corrective slide in the prices.
A sense of calm prevails at the moment, as markets eagerly look forward to President Trump’s address to the nation, in lieu of the Iranian retaliation. Trump’s response is likely to have a significant impact on the oil price dynamics. Also, of note remains the Energy Information Administration (EIA) Crude Oil Stocks Change data due later in the NA session for fresh trading incentives.
WTI Technical levels to consider