11 June 2025,07:57
Daily Market Analysis
11 June 2025, 07:57
Key Takeaways:
*WTI dips as weak Chinese demand and rising U.S. fuel stocks outweigh trade talk optimism.
*OPEC+ output is drifting higher, with risks of sharper supply increases into Q3.
WTI crude prices dipped this week, retreating from recent highs as fragile demand signals and mounting supply risks overshadowed fleeting optimism around the U.S.–China trade talks. Futures fell toward $64.93/bbl after briefly testing resistance above $65.29, with the pullback reflecting a broader unease over deteriorating global consumption trends and the prospect of rising OPEC+ output.
China’s latest trade and industrial data continued to disappoint, with May crude imports sliding to a four-month low amid refinery maintenance and sluggish domestic growth. Export momentum cooled, and factory-gate deflation deepened, reinforcing the view that demand from the world’s largest oil importer remains subdued. These concerns were compounded by the World Bank’s downgrades global growth forecast for 2025, which flagged tariffs and trade frictions as persistent drags on the recovery.
On the supply side, OPEC+ raised output by 150,000 bpd in May—below planned targets but still indicative of a measured push to reclaim market share. Market participants are bracing for steeper production increases in Q3, particularly if Saudi Arabia and core Gulf producers move to tap spare capacity. U.S. inventory data offered mixed signals: while crude stockpiles unexpectedly declined, gasoline and distillate builds exceeded forecasts, hinting at softening refined product demand just as summer driving season begins.
Trade negotiations in London lent fleeting support, but the lack of concrete progress on tariff relief kept sentiment capped. The forward curve’s tilt toward contango further reflects oversupply anxieties, suggesting storage pressures may intensify if refined product inventories continue to swell.
Technical Analysis
WTI crude oil eases from recent highs after rallying past the $63.65 resistance zone, pausing just below the $66.30 ceiling—an area that capped gains at the end of May. The breakout above a tight consolidation range signals bullish continuation, though upside momentum is cooling near key resistance.
Momentum indicators show signs of waning strength. The RSI has retreated from near-overbought territory, now at 55, suggesting bulls may be losing steam short term. The MACD remains above the signal line but has started to flatten, with declining histogram bars hinting at fading momentum.
The price reaction around $66.30 will be crucial. A clean break above this ceiling could open the door toward $68.70, but failure to clear resistance may trigger a pullback toward the $63.65–$62.00 support band as traders reassess demand signals and inventory trends.
Resistance Levels: 66.30, 68.70
Support Levels: 63.65, 62.00
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