WTI Futures Trade Higher Following Overnight Weakness

WTI Crude oil futures fell yesterday as markets eyed the tariff deadline for India’s purchase of Russian crude. President Trump has threatened India with doubled tariff levels if their buying of Russian crude continues. Markets assumed today that the President would back off the threat, sending Crude lower.

Worries over a “sell America” trade persisted through yesterday’s overnight session, with US equities and the Dollar starting the day trading lower. Despite this, a risk-on tone rallied equities back to unchanged, and the Dollar was well off the lows through the US session. Positive US economic data and traders’ focus on NVDA earnings were the primary drivers of the risk-on reversal.

Today, crude oil futures are higher by +0.14 [+0.22%] as the India tariffs go into effect with no action out of President Trump.

Estimates for today’s EIA report are as follows [thousand barrels]:

Crude Oil: -2,000 estimate
Gasoline: -1,600 estimate
Distillate: +500 estimate
Refinery Utilization: -0.40%
Last night’s API report showed draws of -974 k bbls.

Technical Analysis:

If prices can gain some footing above 63.40*** through the US session, we’d view this level as a decent buying opportunity.

Futures failed at key resistance near the 65.15*** level and busted through two key support levels at 64.20*** and 63.40***. While this came on limited volume, the lack of willing buyers was notable. The false move into July’s trading range was odd, coming on a day with limited news flow or additional new catalysts. These markets are becoming increasingly random and risk-management / position sizing should take precedent for traders.