While a move above the 200-day moving average could shift momentum to the upside, bulls still face overhead resistance at the 50-day moving average around $63.71 and a long-term pivot at $64.21. Without a clean break above these levels, crude remains technically vulnerable.
Europe’s NATO Border Tensions Lend Modest Support
Geopolitical developments in Europe provided limited support. Over the weekend, Russia launched strikes near Poland’s border, prompting a deployment of NATO aircraft to secure the airspace. Poland’s military responded quickly, while Estonia and Germany reported violations of NATO-controlled airspace by Russian jets. The United Nations Security Council is meeting Monday to address the airspace breaches.
While these risks underscore ongoing concerns about European energy security, they have not been enough to offset near-term technical weakness or rising supply pressure.
Middle East Tensions Rise on Palestinian Recognition
In the Middle East, fresh tensions emerged after four Western countries recognized a Palestinian state. The diplomatic move drew a sharp rebuke from Israel and raised fears of further unrest in the region — a key concern for oil traders watching for any disruptions from major producers.
Iraqi Output Rises as OPEC+ Cuts Are Rolled Back
Fundamentally, the market remains under pressure from rising output. Iraq’s state oil marketer SOMO confirmed that crude exports averaged 3.38 million barrels per day in August, with September volumes projected to reach as high as 3.45 million bpd. The increases reflect a continued unwinding of voluntary OPEC+ production cuts.
Meanwhile, inventories remain elevated. Analyst Tim Evans noted that while U.S. and Chinese strategic reserve builds have absorbed some excess, the surplus still weighs on near-term price potential.
