Oil nudges higher despite surprise U.S. builds; WTI settles at $58.95 with $60 cap still looming
Crude futures eked out gains even as U.S. inventories rose across the board, keeping the $60 handle as the next hurdle for momentum traders watching short-term resistance.
Market recap
U.S. crude oil futures settled at $58.95 per barrel, up $0.31 or 0.53%. The session traded between $58.37 and $59.64 as buyers faded into resistance and headline inventory data pointed to ample supply.
Key points for energy and FX traders
- WTI settlement: $58.95 (+0.53%); intraday high $59.64, low $58.37
- EIA showed unexpected builds in crude, gasoline and distillates
- Crude +0.574 million vs. -0.821 million expected
- Gasoline +4.518 million vs. +1.468 million expected
- Distillates +2.059 million vs. +0.707 million expected
- Price finished below the rising 100-hour moving average (~$59.07); 200-hour MA sits near $58.65
- Near-term resistance: trendline around ~$59.82; psychological pivot at $60
Inventory breakdown: supply cushion thickens
Weekly data from the U.S. Energy Information Administration pointed to a broader-than-expected build across the oil complex. Crude stocks rose by 0.574 million barrels against expectations for a draw, while product inventories climbed more sharply than forecast, led by gasoline. The mix suggests comfortable supply into year-end and a potentially softer refining margin backdrop if demand doesn’t accelerate.
Technical picture: $58.65–$60 sets the battleground
WTI spent much of the session probing a rising 100-hour moving average near $59.07 but settled just below it—an incremental win for bears. The 200-hour moving average near $58.65 remains the key downside marker; a sustained break would tilt control to sellers and open a path toward deeper pullbacks. On the topside, a downward-sloping trendline near $59.82 is the first test; a decisive move above, followed by a clean hold over $60, would re-energize bullish momentum.
Macro context: inflation optics and risk appetite
With policymakers still sensitive to inflation optics, notably pump prices, a sub-$60 WTI helps keep headline pressures contained. For FX, softer crude can be a mild headwind to oil-linked currencies while offering relief to energy importers. Broader risk appetite remains cautious, leaving oil to trade the push-pull between ample near-term supply and positioning ahead of potential OPEC+ updates and winter demand signals.
What’s next
Traders will watch for follow-through on the inventory builds, refinery run rates, and any guidance from producers that could shift supply expectations. Near-term volatility may be exacerbated by thinner December liquidity, making the $58.65–$60 band a critical zone for directional cues, BPayNews notes.
FAQ
Why did WTI rise even with inventory builds?
Positioning and technical buying supported prices intraday, offsetting the bearish impulse from larger-than-expected builds. The market is also weighing seasonal dynamics and potential producer signals before committing to a new trend.
Which technical levels matter most right now?
$58.65 (200-hour moving average) is the key downside pivot; $59.82 (trendline resistance) and the $60 psychological level cap the topside. A break and hold beyond this range could set the next directional move.
What did the EIA data show this week?
U.S. crude inventories rose by 0.574 million barrels, versus expectations for a draw. Gasoline stocks increased by 4.518 million and distillates by 2.059 million, both above consensus, signaling comfortable supply.
How could this affect currencies and broader markets?
Sub-$60 oil can modestly ease inflation expectations, supportive for risk assets at the margin while tempering support for oil-exporter currencies. Conversely, oil-importing economies may find some relief via improved trade terms.
What should traders watch next?
Updates from OPEC+ and U.S. production trends, refinery utilization rates, and subsequent EIA weekly reports. Price action around $58.65–$60 will likely dictate near-term momentum and volatility.
