Crude oil prices rose to $69.53 yesterday, the highest level since August 4, 2025, and are currently hovering near $69.00 per barrel amid ongoing uncertainty in the oil market driven by mixed factors. Still, oil prices remain down 7% since the beginning of the year.
The positive factors supporting oil prices include:
- Despite U.S. President Donald Trump’s mediation efforts to end the Russia-Ukraine war, geopolitical tensions remain sharp between the two countries. Reports indicated that recent Ukrainian drone attacks have disabled facilities representing at least 17% of Russia’s refining capacity.
- Ongoing trade tensions between the Trump administration and other countries, particularly with India, after Washington imposed 50% tariffs on Indian exports to the U.S. due to India’s continued purchases of Russian oil.
- Improving global demand for oil, especially from China, the world’s largest crude importer. The latest economic data showed signs of strength, such as the Caixin manufacturing PMI rising to 50.5, above both expectations (49.7) and the previous reading (49.5).
On the other hand, several factors are weighing on crude oil prices, most notably:
- A stronger U.S. dollar, which generally exerts downward pressure on oil prices.
- Abundant supply from outside OPEC+.
Markets are now looking ahead to the upcoming OPEC+ meeting later this week, where the producers’ alliance will decide whether to continue output increases beyond September, with expectations leaning toward no further hikes.
From a technical perspective, indicators suggest that oil prices may continue rising for the following reasons:
- A bullish crossover in the MACD indicator between the blue MACD line and the orange Signal line, reinforcing upward momentum.
- The Relative Strength Index (RSI) is currently at 58, indicating additional bullish momentum.
The next challenge lies in whether oil prices can remain above the 50-day and 20-day moving averages, with an attempt to reach the resistance level at the 200-day moving average (in yellow), currently standing at $70.40.
Please note that this analysis is provided for informational purposes only and should not be considered as investment advice. All trading involves risk.
