Ukraine-Russia conflict reintroduces geopolitical risk to oil prices forecast
Bullish sentiment was further fueled by renewed supply concerns tied to escalating Ukrainian drone attacks on Russian oil infrastructure. Russia’s Transneft has warned producers they may need to curb output due to repeated strikes on key ports and refineries. According to Goldman Sachs, attacks have disabled around 300,000 barrels per day of refining capacity between August and mid-September.
JP Morgan analysts flagged that targeting export terminals like Primorsk signals an intent to restrict Russia’s global crude flows—potentially increasing volatility across international oil markets. While Asian buyers continue importing Russian crude, the risk of broader disruptions adds upward pressure to near-term oil prices projections.
Federal Reserve rate cut in focus as traders watch demand cues
Markets are also pricing in expectations of a rate cut from the U.S. Federal Reserve at its September 16–17 meeting. While looser monetary policy could support energy demand by lowering borrowing costs, analysts remain cautious on the broader U.S. economic outlook. Still, any dovish pivot from the Fed would likely be interpreted as a bullish catalyst for crude, particularly if coupled with signs of tightening supply.
Inventory data may confirm tightening U.S. crude supplies
The market is also awaiting official U.S. stockpile data on Wednesday. A Reuters poll showed expectations for declines in both crude and gasoline inventories last week, while distillate stocks likely posted a small increase. If confirmed, the drawdowns would further tighten the supply picture and lend support to current price levels.
Market Forecast: Bullish above $64.56, upside toward $66.03 on breakout
WTI’s move above the 200-day average and its test of the 50-day signals growing bullish momentum. A confirmed breakout above $64.56 would likely accelerate gains toward $66.03, supported by geopolitical supply risks, a potentially dovish Fed, and expected U.S. inventory draws. Near-term outlook remains bullish, with $64.25–$64.56 as the critical resistance zone to watch.
More Information in our Economic Calendar.
