WTI crude oil slips below $60 as OPEC+ supply plan deepens selling pressure

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Crude oil falls below $60

Highlights

- Oil drops over 2% to trade near $60 as OPEC+ mulls production increase.

- Saudi Arabia pushes for output growth to regain market share.

- Technical levels point to $55.20 as key support if selling extends.

Sources suggest Saudi Arabia is leading the push to recapture market share, a move that has overshadowed optimism tied to improving trade relations between the United States and China.

Technical structure shows downside bias

From a technical perspective, the market remains under strain. WTI has continued to trade below a descending trendline that has capped rallies since July, with the latest rejection forming near $63.20 in line with the 50-day exponential moving average. Price has also slipped beneath the 20-day and 100-day averages at $60.34 and $61.77, confirming a near-term bearish tilt.

WTI crude oil price dynamics (Source: TradingView)

The next critical support sits at $55.20, which acted as a major floor in June. A clear break below this level would expose the $50 psychological threshold. Momentum indicators signal caution, with the relative strength index holding at 40.9. While that reading nears oversold territory, it has yet to suggest capitulation, leaving scope for further weakness before any meaningful rebound. A recovery above $63.20 would be needed to shift momentum back toward $65.40, where the 200-day average stands as heavier resistance.

OPEC+ and geopolitical dynamics weigh on sentiment

The slide in prices comes as OPEC+ members discuss how to manage rising inventories against a fragile demand recovery. Reports indicate a split within the group, with Saudi Arabia favoring a supply boost to defend market share, while others urge restraint to avoid flooding the market. The uncertainty around output strategy has kept traders cautious ahead of the weekend meeting.

Geopolitical factors have added complexity. The United States has expanded sanctions on Russian oil producers Rosneft and Lukoil, which together account for a large portion of Russia’s output. While the measures raise compliance risks for global buyers, they stop short of major supply disruptions. For now, this approach has limited volatility, though stricter enforcement could still spark sharp market adjustments.

Outlook

Oil’s near-term trajectory hinges on OPEC+ policy decisions and the market’s response to them. If producers agree to raise output in December, it could deepen the current correction and test the $55–56 range. Conversely, a pause or cut in production would likely stabilize prices and invite a recovery toward $63.

As previously noted, the broader trend remains shaped by the tug-of-war between trade optimism and supply risk. The rebound in demand tied to U.S.-China trade progress may offer a cushion, but until OPEC+ signals restraint, sellers are likely to maintain the upper hand. For traders, the $55.20 level now marks the line between consolidation and potential capitulation.

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