On Thursday, WTI crude rose about 11% to over $87.00, its highest level since October 2023, in a session dominated by a single powerful bullish candle that eclipsed every session of the past three months. The price is now up more than 30% from the consolidation zone near $65.00 that it held for most of February, surpassing every overhead benchmark level in a near-vertical rally.
The reason for this was the escalation of the US-Iran conflict. Coordinated US-Israeli airstrikes on Iran launched on February 28, dubbed Operation Epic Fury, killed Supreme Leader Ali Khamenei and prompted Iran’s Islamic Revolutionary Guard Corps (IRGC) to declare the Strait of Hormuz closed. Nine ships have been attacked since the conflict began, including an oil tanker near the Iraqi port of Khor al Zubair and another near Kuwait that was taking on water and spilling oil on Thursday. The strait normally transports about 20% of the world’s daily oil supply, and tanker traffic has dropped to almost zero.
On the demand side, China has ordered its largest refiner to suspend diesel and gasoline export contracts, further tightening global fuel supply. Qatar halted liquefied natural gas production at its two main plants following attacks on infrastructure, removing about 20% of global LNG supplies from the market. Iraq has begun suspending operations at the Rumaila oil field due to a lack of storage space as tankers continue to be unable to leave the Persian Gulf. President Trump wrote that there will be “no agreement with Iran other than unconditional surrender,” while Qatar’s energy minister warned that oil could reach $150 a barrel if the strait remains closed.
WTI daily chart
Technical analysis
On the daily chart, the price of WTI US OIL is USD 88.06. The near-term sentiment is bullish as price accelerates above both the 50-day and 200-day exponential moving averages, confirming a sturdy breakout from the previous consolidation band in the low and mid-$60s. A widening gap between shorter and longer EMAs signals strengthening trend momentum, while a stochastic indicator hovering deep in overbought territory reflects intense upside pressure rather than an immediate reversal signal at this stage of the move.
Initial support is located near the rising 50-day EMA near $65.20, with the 200-day EMA near $63.20, which will strengthen the second level if a corrective pullback occurs. A break below this concentrated moving average area would indicate a weakening of the upside momentum and exposure of the previous closing area around $62.00. On the other hand, the psychologically significant $90.00 level acts as the next resistance to watch, and a sustained daily close above this level will open the door to further gains towards higher, unexplored areas within the current rally.
(The technical analysis for this story was written with the facilitate of an AI tool.)
Frequently asked questions about WTI crude oil
WTI Oil is a type of crude oil sold on international markets. WTI stands for West Texas Intermediate, one of three main types, including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” due to its relatively low weight and low sulfur content. It is considered a high-quality oil that can be easily refined. It originates in the United States and is distributed through the Cushing Junction, considered the “Crossroads of the World.” It is a reference point for the crude oil market, and the WTI price is often quoted in the media.
Like all assets, supply and demand are key factors influencing the price of WTI crude oil. Therefore, global growth may drive increased demand and, conversely, feeble global growth. Political instability, wars and sanctions can disrupt supply and affect prices. Another key factor shaping prices are the decisions of OPEC, the group of major oil-producing countries. The value of the US dollar affects the price of WTI crude oil because oil is mainly sold in US dollars, so a weaker US dollar can make oil more affordable and vice versa.
Weekly crude oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Administration (EIA) influence the price of WTI crude oil. Inventory changes reflect fluctuations in supply and demand. If the data shows a decline in inventories, it may indicate increased demand, which will result in an augment in the price of oil. Higher inventories may reflect increased supply, which causes prices to fall. The API report is published every Tuesday and the EIA report the next day. Their results are usually similar and are within 1% of each other 75% of the time. EIA data is considered more reliable because it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 oil-producing countries that jointly decide on production quotas for member countries at meetings held twice a year. Their decisions often influence the prices of WTI crude oil. When OPEC decides to cut quotas, it can tighten supply, which will push up oil prices. OPEC increasing production has the opposite effect. OPEC+ refers to an expanded group that includes ten additional non-OPEC members, the most notable of which is Russia.
