Crude Futures Consolidate—Neutral Bias, Range in Play

WTI Crude Oil Futures (June Future)

Yesterday’s Settlement: 61.62, down -1.53 [-2.42%]

WTI Crude Oil futures fell sharply yesterday after President Trump said that an Iran nuclear deal was close. This comment was the main driver of crude pricing for yesterday’s session.

In an interview with NBC, an Iranian official reiterated Iran’s position that it was willing to limit their enrichment of Uranium in exchange for looser sanctions. President Trump referenced this interview when suggesting that the US and Iran are close to reaching an agreement on the nuclear accords. Crude Oil markets are trading lower on the comments.

Today, Crude Oil is up +0.38 [+0.62%] to 61.53

Today’s macro environment is trading risk-on with bonds, equities and crude oil all trading marginally higher. Precious metals are weaker on the day.

Russia-Ukraine peace talks seem to have hit a stalemate with Russia demanding full control of 5 Ukrainian regions. The US will likely target Russian crude flows if they choose to respond.

Summary & Bias

Bias Summary from May 5th – 6th:

The bearish catalyst that has kept us sidelined has now been realized. As we turn our analysis forward, the environment is chalked with bullish potential catalysts. Because of this, we shifted our bias to Neutral / Bullish the morning of May 5th on the Sunday night ~4% gap lower in futures.

On paper, the forward-looking balance sheet looks oversupplied with accelerated OPEC hikes against a weaker demand outlook with the global economic slowdown we’re currently experiencing.

This will be the bear case, and it’s a valid case, but it uses somewhat lazy math. If you back out Iranian barrels, lower US production growth, and back out some Venezuelan barrels, the picture looks much different.

When you add some risk-premia for potential Russian sanctions and an escalation of the Middle Eastern conflict, you get to our bull case of the mid-60s level.

We can now add improving US-China dialogue to the potentially bullish catalyst list. The top end of our medium-term outlook is $65, and we like prudent profit taking around $62.50.

Added 5/12/2025: With an interim trade deal reached, the upside on crude is extended.Markets will now try and price in a revived Chinese economy after the trade deal and we’d like to see where price action goes through today.

Added 5/14/2025: Subscribers to our research portal were alerted to our bias shift midday yesterday. While there is still some upside potential towards the 65.00 level, our target for the trade was around 62.50. Having reached our target, we would like to clear the book and wait for the next opportunity.

Technical Analysis:

WTI Crude Oil futures look to be consolidating in a trading range between 63.81** and 61.05**. We remain neutral on our bias in crude but may play the trading range until our bias changes.

For intraday trading, our pivot and point of balance is set at…