Crude Oil Market Analysis: Geopolitical Relaxation Coupled with Ample Supply and Demand, Short-term Volatility Under Pressure

Recently, crude oil prices surged then pulled back, with WTI falling to around $59, and Brent fluctuating in the $64 range, mainly due to easing Middle East tensions and the gradual fading of geopolitical risk premiums.
Fundamentally, the global crude oil supply and demand balance remains loose through 2026. OPEC+ paused production increases in Q1 but cannot offset previous cumulative gains. Non-OPEC+ countries like the US and Brazil are operating at high output levels, and the market expects significant oversupply throughout the year. Demand growth has slowed, winter demand in the Northern Hemisphere remains weak, and refinery maintenance further weakens support.
Technical analysis shows that key resistance for WTI is at $59.85, with support at $59.07. A break below could lead to a test of $58.29. Operationally, a range-bound strategy is recommended: lightly short on rallies, and look for long positions on dips supported by key levels, with strict stop-losses.
Focus should be on monitoring Iran developments, the International Energy Agency’s monthly reports, and inventory data, while remaining alert to sudden geopolitical disturbances that could trigger volatility.