WTI price forecast: Oil struggles below $70 as tariff threats weigh on demand
WTI crude oil trades near two-month low amid tariff fears and rising global supply concerns
West Texas Intermediate (WTI) crude oil remains under pressure, retreating from $70 per barrel amid fresh concerns over global economic growth and trade tensions. WTI futures fell to $69.20 in European trading hours on Friday after briefly rebounding from a two-month low of $68.30 recorded earlier in the week.
The sharp pullback came as U.S. President Donald Trump announced additional 10% tariffs on Chinese imports, reigniting fears of weakened oil demand from the world’s largest crude importer.
Trump’s tariff escalation, citing concerns over China’s role in fentanyl exports, could dampen economic growth and reduce energy consumption, weighing heavily on crude prices. Meanwhile, the 25% tariffs on Canadian and Mexican imports set for March 4 further complicate the trade outlook, raising fears of a broader global slowdown.
USOIL price dynamics (Jan 2025 - Feb 2025) Source: TradingView.
Rising supply risks from Iraq and Russia
Beyond trade concerns, oil prices are also facing increasing supply risks. Iraq’s oil ministry announced plans to resume crude exports from the Kurdistan region, with an initial target of 185,000 barrels per day (bpd) through state marketer SOMO. Analysts warn that increased Iraqi output could offset OPEC+ production cuts, adding further downward pressure on crude markets.
Additionally, growing optimism over a Russia-Ukraine peace agreement has kept oil prices in check. A potential lifting of Western sanctions on Russian oil could increase global supply, reversing the impact of prior restrictions on seaborne exports. Investors are closely monitoring Trump’s scheduled meeting with Ukrainian President Volodymyr Zelenskyy for further clarity on the geopolitical landscape.
Technical outlook: Key resistance and support levels
From a technical standpoint, WTI crude faces strong resistance at $70.59, which aligns with the 200-day moving average. A break above this level could trigger a short-term rally toward the 50-day moving average at $72.08. However, failing to hold above $69.00 may open the door for a decline toward $67.06, the next major support zone.
Market sentiment remains fragile, with investors awaiting U.S. economic data and OPEC+ production signals. For now, WTI’s near-term direction hinges on trade developments and supply-side adjustments from key oil-producing nations.
As previously discussed, WTI crude remains bearish amid trade tensions and supply concerns. Resistance at $70.59 limits upside.
