Oil Markets Pause Losses as Brent Holds $66 and WTI $63

Brent crude traded at $66.28 and WTI at $63.08 per barrel early Friday, stabilizing after a week of heavy selling that erased the war premium built into prices. Official exchange data shows both benchmarks up less than 1% in the last 24 hours.

However, they are still down about 12% for the week, marking their steepest drop in two years. The Iran-Israel ceasefire held, removing fears of a major Middle East supply shock and prompting traders to unwind risk positions.

U.S. government reports confirmed a significant drawdown in crude and fuel inventories, with refinery activity and gasoline demand rising as the summer driving season began.

Analysts noted that inventories look tight, which helped prices recover from the week’s lows. The U.S. dollar index fell to a three-year low, making oil cheaper for buyers in other currencies and adding support to prices.

Market participants also reacted to speculation about a possible early announcement of the next Federal Reserve chair, which increased expectations of rate cuts.

Technical analysis of the most commonly used indicators on both the four-hour and daily charts for Brent and WTI confirms the market’s indecision. Prices sit just above major support levels and key moving averages, including the 100- and 200-period lines.

On the four-hour chart, MACD remains negative but shows signs of flattening, while RSI hovers near 38 for both benchmarks, indicating the market is emerging from oversold territory but lacks strong momentum.

Bollinger Bands have widened after the sharp decline, with prices consolidating near the lower band, reflecting ongoing volatility and a lack of clear direction.

Volume analysis shows no surge in trading activity, suggesting that the recent price stabilization is driven more by short covering than by new buying. ETF flows remain muted, with investors waiting for a clearer signal before committing capital.

The fundamentals reflect a tug-of-war: OPEC+ spare capacity and production discipline provide a floor, while robust U.S. demand and tightening inventories offer support.

However, the removal of the geopolitical risk premium and the possibility of higher OPEC+ supply at the July meeting limit upside potential.

The charts and official market data point to a period of consolidation, with prices compressed between support and resistance and no clear trend established.

Traders remain cautious, waiting for a catalyst such as a new OPEC+ policy move, fresh macroeconomic data, or renewed geopolitical tension.

For now, the market narrative is shaped by tight supply, a weaker dollar, and the absence of new shocks. The next move will depend on whether fundamentals or a new headline tips the balance.

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