WTI crude oil price faces resistance at $62 amid easing trade tensions
WTI oil struggles to break above $62 resistance amid ongoing supply and geopolitical risks
WTI crude oil prices rose to around $61.65 per barrel on Tuesday, responding positively to the easing of trade tensions between the U.S. and the European Union. President Donald Trump's decision to delay a 50% tariff on European imports until July has helped alleviate concerns about an economic slowdown that could dampen global fuel demand.
Highlights
- WTI oil prices rise to $61.7 as U.S.-EU trade tensions ease.
- OPEC+ expected to raise production by 411,000 bpd in July.
- Geopolitical risks, including U.S.-Iran talks continue to influence prices.
However, the gains remain fragile, with the market facing significant resistance near the $62 level.
Despite the short-term positive momentum, market participants remain wary of oversupply risks. OPEC+ is set to meet later this week, where a decision to increase production by 411,000 barrels per day for July is expected. This move follows previous agreements to accelerate output increases in June. On the geopolitical front, U.S.-Iran nuclear talks remain uncertain, with Iran's refusal to suspend uranium enrichment threatening to collapse the negotiations. If talks break down, continued sanctions on Iran's oil exports could provide upward pressure on oil prices.
WTI crude oil has remained within a narrow trading range, bouncing between resistance at $63.45 and psychological support at $60. The technical picture shows indecision in the market, with the 4-hour RSI hovering around the neutral 50 line. However, a bullish engulfing candle on Friday’s daily chart has provided a slight positive signal, although the upside remains capped by the $62 resistance level.
USOIL price dynamics (Source: TradingView)
Short-term outlook and key support levels
Looking ahead, the focus will be on the $62 resistance zone, which coincides with the May 26 high. A break above this level could open the path for further gains, targeting $63.50, the top of the price channel. On the downside, the immediate support remains at $61, followed by the key psychological level of $60. A breach of this level could signal further downside pressure.
As discussed previously, WTI oil's price movement is likely to remain range-bound in the short term, with any significant price action dependent on breaking through either $62 on the upside or $60 on the downside.
