WTI holds near three-week low as traders await Hormuz agreement
West Texas Intermediate (WTI) Crude Oil remains under pressure on Wednesday but struggles to attract fresh selling as traders await confirmation that commercial shipping through the Strait of Hormuz will resume. At the time of writing, WTI trades around $74 per barrel, hovering near three-week lows.
WTI Crude Oil continues to face downward pressure on Wednesday, failing to attract additional selling as traders await clarification on the resumption of commercial shipping through the Strait of Hormuz. At present, WTI is trading near $74 per barrel, approaching three-week lows. Iran and Oman have reportedly reached an understanding regarding the coordinates of a proposed shipping route, though Iran's Foreign Ministry emphasizes that a final agreement is still pending, contingent upon "third parties" not interfering.
According to an informed source, an Iran-Oman agreement alone would not automatically reopen the Strait, necessitating separate arrangements and the fulfillment of US commitments. Pending the final agreement and resumption of shipping, geopolitical risk is expected to continue influencing oil prices, preventing further declines.
US Energy Information Administration data revealed an unexpected increase in Crude Oil inventories by 2.479 million barrels, surpassing expectations of a 1.5 million-barrel reduction. Previous week's stocks fell by 7.167 million barrels. The near-term outlook for WTI remains bearish, as prices remain below key moving averages and momentum indicators indicate that sellers still hold the upper hand.
The 50-day SMA at $79.58 and the 21-day SMA at $80.27 serve as immediate resistance points, while the $67.00-$70.00 zone provides support. A break below this range could trigger a deeper decline.
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