Headline: Oil Futures Slip as OPEC Flips Q3 Outlook to Surplus
Introduction: Crude oil futures closed lower as traders reacted to a swift shift in the supply outlook, with fresh signals of oversupply overshadowing geopolitical support and demand hopes.
Crude oil futures settled at $58.49 after swinging between a high of $61.06 and a low of $58.30. Sentiment turned sharply bearish following OPEC’s updated view for the third quarter, moving from a projected 400,000 bpd deficit to an expected 500,000 bpd surplus. The reversal was driven by stronger-than-anticipated U.S. production alongside increased OPEC output, reinforcing concerns about a near-term supply glut in the global oil market.
Fundamentals were compounded by price action from Saudi Arabia, which reduced its key crude price to Asia to the lowest in almost a year—an indication of softer regional demand. A firmer U.S. dollar added pressure to dollar-denominated commodities, further weighing on energy prices and risk appetite.
From a technical perspective, the market slipped below a cluster of converging moving averages near $60.30 and breached a lower swing area around $59.58, handing momentum to sellers. As long as prices remain capped beneath those levels, the bearish bias persists, with resistance now seen near $60.30–$61.45 and immediate support at $59.58 and the session low at $58.30.
Key Points: – Crude oil futures settled at $58.49, with an intraday range of $58.30–$61.06. – OPEC revised its Q3 outlook from a 400,000 bpd deficit to a 500,000 bpd surplus. – Higher-than-expected U.S. output and increased OPEC production drove the shift. – Saudi Arabia cut its key crude price to Asia to an 11-month low, signaling softer demand. – A stronger U.S. dollar pressured dollar-denominated oil prices. – Technically bearish: prices fell below converging MAs near $60.30; resistance sits at $60.30–$61.45 with support at $59.58 and $58.30.
