Oil Prices Edge Higher as US Cuts Global Oversupply Forecast

Oil prices gained modest ground Wednesday morning, with WTI crude trading at $66.35 per barrel and Brent approaching $70.

The Energy Information Administration recently slashed its prediction for global surplus, citing potential diminished flows from Iran and Venezuela. Both benchmarks recovered slightly after Monday’s 1.5% drop, with WTI settling at $66.25 on Tuesday.

Market sentiment remains cautious amid ongoing concerns about global economic growth and trade tensions. The dollar index hit a four-month low Tuesday, making oil less expensive for overseas buyers and providing fundamental support.

Tariff worries continue to cap gains as President Trump announced an additional 25% tariff on steel and aluminum imports from Canada. These protectionist measures have sparked fears about slowing economies worldwide and reduced fuel demand.

Chinese economic concerns add further pressure, with deepening deflationary trends despite stimulus efforts. OPEC+ plans to increase output in April create additional supply uncertainty.

Oil Markets Steady Amid Supply-Demand Dynamics

Russian Deputy Prime Minister Alexander Novak stated the decision could be reversed if market imbalances emerge. Supply-demand dynamics show immediate demand for crude oil remains robust despite economic worries.

API data released Tuesday showed US crude stockpiles rose by 4.2 million barrels in the week ended March 7. Traders now await official government inventory data for further direction.

Competition between Saudi Arabia and Russia for Asian market share intensifies as China‘s maritime imports from Russia fell to 969,000 bpd in February. Technical indicators suggest WTI finds support around $65-$66 levels, with resistance at $67.50.

Brent maintains strong technical support near $70 per barrel. The RSI hovers around 52, indicating neutral market conditions. Market participants will closely watch US inflation data due later today for clues on interest rate trajectories.

Analyst sentiment suggests light positioning means headlines can fuel short-term bounces, but underlying economic concerns may keep crude under pressure long-term. The seventh consecutive weekly loss for WTI marks the longest losing streak since December 2023.

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