On the downside, continued rejection at the 200-day MA raises the risk of a retest and potential breakdown through this week’s low of $61.94. A close below that level could accelerate losses toward the next major support zone at $56.91.
At 14:02 GMT, Light crude oil futures are trading $63.18, down $0.78 or -1.22%.
Trump-Putin Talks Stir Caution Ahead of Possible Russia Sanctions Relief
Traders are closely monitoring Friday’s high-stakes meeting between U.S. President Donald Trump and Russian President Vladimir Putin in Alaska. A potential ceasefire deal in Ukraine could pave the way for easing Western sanctions on Russian oil exports. Trump has floated the idea of lifting penalties if peace progress is made but warned of secondary sanctions against buyers of Russian crude should talks fail.
Markets remain on edge as any de-escalation could lead to a pickup in Russian oil supply. UBS commodities analyst Giovanni Staunovo said the key question for traders is “escalation or de-escalation,” with supply implications hanging in the balance. Brent is poised for a weekly gain of 0.4%, while WTI is on track for a 0.7% decline.
Weak China Data Undermines Demand Outlook Despite Refinery Throughput Rise
Economic data out of China further weighed on oil sentiment. Factory output growth in July hit an eight-month low, while retail sales growth slowed to its weakest since December. Despite an 8.9% year-on-year rise in refinery throughput, the month-over-month decline and rise in oil product exports suggest softening domestic fuel demand in the world’s second-largest crude consumer.
OPEC+ Supply Growth and Fed Policy Cloud Oil Prices Forecast
Forecasts of a deepening oil market surplus also pressured sentiment. Bank of America now projects an average oversupply of 890,000 barrels per day from July 2025 through June 2026, driven by rising output from OPEC+ producers. These projections align with recent IEA warnings that the market is becoming “bloated” following production increases.
