A breakout above this zone could unlock upside momentum toward last week’s swing top at $65.10, followed by a minor pivot at $65.41. The next major objective is $66.18, which marks the 50% retracement of the $56.09 to $76.27 trading range. A sustained move through that level could drive prices toward heavier resistance between $68.70 and $69.69.
On the downside, the 200-day moving average at $63.28 remains the key support level. With major players sidelined for the holiday, traders are treating price action with caution. Thin volume increases the likelihood of false breakouts and intraday traps.
OPEC+ Supply Growth and U.S. Output Expansion Cap Upside
From a supply standpoint, the market remains heavy. U.S. crude production rose to a record 13.58 million barrels per day in June, according to the EIA, up 133,000 bpd. OPEC+ is set to increase output by 547,000 bpd in September, and analysts suggest the group may not be finished with supply hikes.
Both WTI and Brent declined more than 6% in August, breaking a four-month winning streak as supply growth outpaced demand. A Reuters poll showed limited upside, with WTI expected to average $64.65 and Brent $67.65 in 2025. For now, rising production and soft demand projections continue to weigh on sentiment.
Geopolitical Risks Offer Limited Support Amid Rising Tensions
Russia-Ukraine tensions remain a factor, offering a modest geopolitical risk premium. Russia’s weekly crude exports fell to a four-week low of 2.72 million bpd, impacted by intensified cross-border strikes. Ukrainian President Zelenskiy vowed retaliation following fresh attacks on power facilities.
While no major supply outages have materialized, risks remain elevated. Markets are also monitoring a regional summit in Beijing involving Russia, India, and China ahead of the September 7 OPEC+ meeting.
