WTI crude oil prices have tumbled more than 17% since January, settling just above $62 a barrel as sellers maintain control of the market. The oil industry faces mounting pressure from excess supply forecasts while Brent crude holds slightly stronger at $65 per barrel. Geopolitical factors add significant uncertainty, particularly the ongoing U.S.-Iran negotiations which could release 1.2 million barrels daily into global markets if sanctions end. OPEC+’s recent decision to boost production by 411,000 barrels per day beginning in June has only heightened oversupply concerns across the sector.

The oil market presents a challenging outlook despite U.S. crude inventories dropping by over 2 million barrels last week. Technical indicators reveal both Brent and WTI trading below their 200-period simple moving averages, confirming the bearish trend remains intact. Oil price projections now suggest WTI will likely struggle in the mid-to-high $50s throughout the third quarter, coinciding with peak trade disruption impacts.

WTI crude oil price drops below $62 amid global market jitters

“Europe’s Brent crude oil, the U.S. WTI crude oil, and OPEC’s basket are three of the most important benchmarks used by traders as reference for oil and gasoline prices” — Statista, Leading provider of market and consumer data

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West Texas Intermediate (WTI) crude futures have broken below the critical $62 per barrel mark, confirming the bearish trend many analysts anticipated amid mounting global economic concerns. The benchmark U.S. oil has shown notable volatility throughout May, initially gaining on positive U.S.-China trade developments before succumbing to broader market pressures [15].

WTI crude oil price today and recent movement

WTI crude currently trades at $61.74 per barrel [15], marking a steep decline of 12.15% since 2025 began [15]. This downward movement follows a brief rally to $61.95 on Monday [15] after the U.S. and China agreed to temporarily reduce bilateral tariffs.

Market sentiment quickly deteriorated as traders faced multiple bearish factors. Tuesday’s session saw WTI crude futures settle at $60.42, dropping $1.63 (-2.6%) to their lowest level since April 10 [15]. June futures contracts trade at $62.05, demonstrating continued selling pressure as uncertainty persists [5].

Technical analysis shows WTI crude has established a crucial support zone at $61.05, which many traders view as vital for preventing deeper declines [5]. A break below this level could trigger a more substantial drop toward the high $50s or even lower support at $54.67 [5]. The 50-period Exponential Moving Average at $60.33 provides some technical support for prices [6].

Broader market data shows WTI crude has lost 0.43% over five days and remains down 13.24% over three months [7]. The 52-week trading range spans from $55.12 to $84.52, highlighting substantial deterioration from last year’s peaks [7].

Brent crude oil price comparison

Brent crude, the international benchmark, shows moderately stronger performance compared to WTI, trading at $64.98 per barrel [6]. This creates a Brent-WTI spread of approximately $3-4, reflecting different regional supply-demand dynamics.

Recent trading saw Brent crude futures settle at $64.25 after falling $1.61 (-2.4%) [15], slightly outperforming WTI during the market decline. Historically, this spread has fluctuated based on geopolitical events and transportation issues. During the 2011 transportation constraints to Cushing, Oklahoma (the WTI settlement point), the spread widened significantly [15].

The current price relationship continues to reflect transportation advantages for Brent crude. While WTI faces fixed storage constraints at Cushing, Brent’s North Sea production allows easier transport to waterborne tankers for temporary storage [15], offering greater flexibility during market disruptions.

Technically, Brent crude maintains an ascending channel on the 4-hour chart, with support at $64.61 and stronger backing at $63.13 if selling pressure intensifies [6]. Immediate resistance sits at $66.34, followed by $67.43 if buyers regain control [6].

Live WTI crude oil price in dollar context

WTI crude futures daily trading range falls between $62.19 and $63.17 [7], showing continued volatility as traders weigh conflicting market signals. The contract structure shows a backward price curve, with July 2025 futures at $63.13, declining to $61.04 for December 2025 delivery [7]. This backward curve indicates traders expect improved supply conditions or weakening demand in coming months.

JP Morgan recently cut its WTI price forecast for 2025 to $62.00 per barrel from $69.00, citing higher OPEC+ production and softer global demand [2]. Analysts now expect global oil demand to increase by just 0.8 million barrels per day, with growth averaging only 0.3 million barrels daily in the third quarter [2].

Trading Economics projections suggest WTI crude will trade around $63.28 per barrel by quarter’s end, with a longer-term outlook placing prices at approximately $65.70 in 12 months [15]. These forecasts remain highly uncertain given the complex geopolitical landscape.

Some technical traders have identified potential bullish pullback scenarios despite current weakness. Trading strategies include entry points around $62.30-$62.26 with stops below $61.65, targeting possible recoveries toward $66.70 if sentiment improves [15]. This outlook conflicts with JP Morgan’s assessment that oil markets face an “80% probability of a mild recession” alongside increased OPEC production [2].

Iran Nuclear Talks Revive Fears of Increased Oil Supply

Ongoing negotiations between Iran and the United States regarding Tehran’s nuclear program have sent oil markets reeling, adding significant downward pressure on WTI crude oil price. The prospect of a deal has triggered the largest daily price drop this month as traders brace for potential new oil supplies flooding global markets if sanctions against Iran are lifted [15].

Tehran and Washington Edge Closer to Interim Deal

Diplomatic momentum has accelerated after President Donald Trump announced the United States was “getting very close” to securing a nuclear agreement with Iran, noting that Tehran had “sort of agreed” to the proposed terms [15]. Recent talks between Iranian and U.S. negotiators concluded Sunday, with additional discussions already scheduled [15]. Meanwhile, Iran’s leadership appears to be pivoting toward proposing a temporary nuclear agreement rather than pursuing the more complex comprehensive deal that President Trump wants completed within his two-month deadline [15].

This interim arrangement would likely include partial suspension of Tehran’s uranium enrichment activities, reduction of its 60% enriched uranium stockpile, and expanded access for UN inspectors to Iran’s nuclear facilities [15]. Despite these potential concessions, serious obstacles remain. Iranian Deputy Foreign Minister Majid Takht-Ravanchi has warned bluntly that “nuclear talks will lead nowhere if Washington insists that Tehran stop its uranium enrichment activity” [15].

White House spokesperson Steve Witkoff is set to meet with Iranian Foreign Minister Abbas Araghchi in Oman, though even the format remains contested – the U.S. insists these are direct negotiations while Iran maintains they’re being conducted through Omani intermediaries [15]. The talks appear tenuous at best, with Iran’s Supreme Leader Ayatollah Ali Khamenei publicly expressing skepticism about whether any agreement will materialize [15].

Potential Return of 1.2 Million Barrels Per Day

The oil market’s primary concern centers on increased global supply should sanctions ease. World Bank projections suggest next year’s global oil supply could exceed demand by 1.2 million barrels daily – a surplus witnessed only twice before: during 2020’s pandemic shutdowns and the 1998 oil price collapse [15].

The International Energy Agency offers more conservative figures, estimating Iran controls approximately 300,000-400,000 barrels per day of spare capacity [1]. StoneX analyst Alex Hodes similarly projects potential Iranian export increases of 300,000 to 400,000 barrels daily if U.S. sanctions were relaxed [15]. Any agreement would likely allow Iran to boost exports within this range [15].

Iran has shown remarkable resilience under sanctions, maintaining average production of 3.3 million barrels per day last year despite severe restrictions [15]. This performance suggests the actual market impact might prove less dramatic than feared. Would the market truly face overwhelming supply, or might Iranian production simply replace declining output elsewhere?

Impact on WTI Crude Oil Spot Price

WTI crude oil spot price has reacted sharply to developments in the negotiations. Tuesday saw crude futures trading lower, pressured by easing tensions and the looming prospect of Iranian oil returning to global markets [15]. Goldman Sachs’ oil market analysis indicates prices will likely weaken further in 2025’s second half as a potential U.S.-Iran deal could significantly increase global oil supply through 2026 [15].

While Iran’s potential additional supply represents a relatively small percentage of global production, its psychological impact on traders has been substantial. Oil prices slumped Thursday following Trump’s comments suggesting the two sides were approaching agreement [15]. The market, already struggling with oversupply concerns, views potential Iranian crude’s return as yet another bearish factor for WTI crude oil price.

Some analysts suggest any price decline following sanctions removal might prove more temporary than widely assumed [15]. With warnings of peak U.S. shale production and demand that has consistently defied bearish forecasts, Iranian sanctions relief might cause only a brief price drop before market forces restore balance [15].

OPEC+ Output Strategy Adds to Oversupply Concerns

OPEC+ has escalated its approach to address internal compliance issues, approving a second consecutive monthly production increase of 411,000 barrels per day for June. This aggressive output expansion has intensified market fears of oversupply, pushing WTI crude oil price to a four-year low on Monday. The production boost unwounds 44% of the 2.2 million bpd cuts agreed upon since 2022, adding substantial uncertainty to global oil supply projections.

Kazakhstan and Other Members Diverge from Quotas

Kazakhstan has emerged as the focal point of OPEC+ tensions after its oil production rose by 2% in May, openly defying the group’s quota system. Currently producing approximately 1.86 million barrels per day, Kazakhstan substantially exceeds its OPEC+ target of 1.486 million bpd. The country’s energy minister plainly stated that Kazakhstan would prioritize national interests over OPEC+ commitments when determining production levels, creating unprecedented friction within the alliance.

Iraq has similarly struggled with compliance, showing clear reluctance to curtail volumes. Both nations have consistently breached production limits, with Kazakhstan repeatedly citing difficulties constraining Western oil majors operating in the country, including Chevron and ExxonMobil. Kazakhstan’s energy ministry claims limited flexibility in output reduction because international firms control key fields, yet promised to compensate for overproduction by reducing cumulative output by 1.3 million bpd by April 2026.

Saudi Arabia’s Push for Compliance

Saudi Arabia’s patience with non-compliant members has worn thin. The kingdom issued what analysts call a “warning shot” one month ago by initiating modest monthly production increases. As compliance issues worsened, Saudi Arabia pushed the coalition to release 411,000 bpd into the market in May, triple the expected amount and representing approximately 0.4% of global supply.

Saudi Energy Minister Prince Abdulaziz bin Salman has delivered a clear message: members must adhere to their targets or face more production increases. This marks a fundamental shift in Saudi strategy from market balancing through output cuts to expanding market share. The kingdom has indicated that if compliance does not improve, all voluntary cuts (totaling 2.2 million bpd) could be completely unwound by November, potentially flooding the market with oil.

June Review and Possible Price War

The upcoming OPEC+ ministerial meeting on June 1 has gained critical importance as the group will review July production levels amid growing market volatility. Analysts suggest the coalition could approve accelerated hikes for August, September, and October if Iraq, Kazakhstan, and other members fail to improve compliance. While some sources hesitate to label the current situation a “price war,” it has revived memories of Saudi Arabia’s 2020 clash with Russia and OPEC’s 2014-2015 confrontation with U.S. shale producers.

Bank of America describes the current scenario as a “slow burn” price war that might persist for 12-18 months rather than a “fast and furious” conflict. This approach aims to discipline both non-compliant OPEC+ members and U.S. shale production. The strategy appears to be working, with Diamondback Energy’s CEO warning shareholders that U.S. shale production will likely peak and decline due to tumbling oil prices.

The escalating production strategy has already impacted WTI crude oil price chart analysis, with JP Morgan downgrading its WTI forecast for 2025 to $62.00 per barrel from $69.00 previously. Goldman Sachs has similarly reduced its projections by $2.00 to $3.00, now expecting live WTI crude oil price in dollar to average $56.00 for the remainder of 2025.

Trade Tensions and Global Growth Fears Weigh on Demand

“As with most commodities, crude oil prices are impacted by supply and demand, as well as inventories and market sentiment” — Statista, Leading provider of market and consumer data

“As with most commodities, crude oil prices are impacted by supply and demand, as well as inventories and market sentiment” — Statista, Leading provider of market and consumer data

Mounting trade tensions between major economies have significantly dampened oil demand prospects, creating a perfect storm alongside the supply concerns that have pushed WTI crude oil prices downward. The combination of tariff uncertainty and deteriorating economic indicators has forced many analysts to cut their oil demand forecasts for 2025.

U.S.-China Tariff Uncertainty

The trade relationship between the U.S. and China has created market whiplash after escalating to unprecedented levels. In early April, the U.S. effective tariff rate exceeded levels seen during the Great Depression. Currently, the two economic powers have established a temporary 90-day truce, with the U.S. reducing additional tariffs on Chinese imports from 145% to 30%, while Chinese duties on U.S. imports dropped to 10% from 125%.

Even with this pause, the economic damage persists. One industry analyst described the tariff situation as creating uncertainty similar to “a broken stoplight at a busy intersection” where all traffic crawls to a near halt. The stop-and-go nature of trade policy has triggered substantial logistics disruptions, with companies rushing to import goods that had remained at ports for 40 days.

IMF’s Downgraded Global GDP Forecast

The International Monetary Fund has dramatically reduced its global growth outlook, now projecting rates of merely 2.8% and 3% for 2025 and 2026 respectively—a substantial 0.8 percentage point reduction from January estimates. This economic deterioration directly impacts oil markets, with the IEA slashing its 2025 global oil demand growth forecast by 300,000 barrels per day to just 730,000 barrels daily.

Half of this downward revision specifically affects the United States and China, with the remainder impacting trade-dependent Asian economies. The IEA further projects an even slower growth rate of 690,000 barrels per day for 2026, citing both economic challenges and accelerating electric vehicle adoption.

U.S. Trucking Slowdown and Diesel Demand

Perhaps the most revealing indicator of weakening demand comes from U.S. diesel consumption, which fell to its lowest seasonal level in 26 years in March 2024. The product supplied of distillate fuel decreased to just 3.67 million barrels per day, marking a significant downward revision from earlier estimates.

This consumption decline directly mirrors manufacturing weakness, with U.S. manufacturers sliding toward recession after five consecutive months of contracting business activity through August. The Institute for Supply Management’s purchasing managers index has remained below the critical 50-point threshold since April, with new orders plummeting to 44.6 (7th percentile) from 47.4 in July.

The trucking industry consequently faces serious challenges, with JB Hunt reporting a 17% drop in revenue per truckload due to diminished demand. Ocean freight orders have fallen 50% year over year, affecting both rail and road transportation. Some industry analysts report spot rates nearly 70% lower this March compared to March 2022.

This deteriorating diesel market serves as an early warning signal for broader oil demand, particularly as distillate fuel oil consumption dropped almost 4% between April and June compared to last year.

Technical Indicators Show Bearish Momentum for WTI

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Technical chart patterns strongly support the fundamental bearish outlook for WTI crude oil prices, with multiple indicators pointing toward continued downside pressure below the critical $62 mark. Since reaching its January 15, 2025 high, price action has formed a double three Elliott Wave pattern, indicating a prolonged corrective phase characterized by alternating declines and recoveries [3].

WTI Crude Oil Price Chart Analysis

The price chart confirms a persistent downtrend with WTI maintaining bearishness below the crucial $65.00 threshold [3]. Would you believe that 64.29% of moving average signals currently indicate bearish momentum? Short-term indicators may be approaching exhaustion points, but the overall direction remains negative [12]. The death cross pattern—a technical formation where short-term moving averages cross below long-term ones—signals potential further weakness ahead [24]. WTI trades within a descending broadening wedge pattern on the 4-hour chart, with price rebounds consistently capped below $64.00 [25].

Support and Resistance Levels

Critical price zones identified through technical analysis include:

• Primary Support: $60.00 (psychological level and immediate barrier) [11]
• Secondary Support: $57.00 (recent multi-week low and key level) [11]
• Strong Support: $55.00 (previous bounce level) [25]

On the upside, resistance remains formidable:

• Immediate Resistance: $63.00 (aligns with 50-period moving average) [26]
• Major Barrier: $65.00 (top of current downtrend) [27]
• Strong Ceiling: $70.00-$71.00 (long-term resistance zone) [25]

MACD, RSI, and Bollinger Band Signals

The Moving Average Convergence Divergence (MACD) displays decisive bearish momentum. The MACD line crossing below the signal line, as witnessed recently, acts like a flashing red light for traders, signaling continued downward momentum [28]. This bearish crossover points toward potential further declines in coming sessions [24].

The Relative Strength Index (RSI) currently hovers around 54 [12], neither overbought nor oversold, yet failing to show any bullish divergence that might suggest upward pressure. RSI readings above 70 typically indicate overbought conditions (sell signals), while readings below 30 suggest oversold conditions (potential buying opportunities) [29].

Bollinger Bands analysis shows strong selling momentum with the histogram remaining negative [11]. These bands function like guardrails for price action—when prices approach the upper band, they often signal selling opportunities, while touches of the lower band might indicate potential buying zones [29]. The bands currently favor bearish movements in the short term [11], reinforcing the overall negative technical outlook for WTI crude oil prices.

Energy Sector Reacts with Cautious Optimism

Major energy corporations have adjusted their strategies amid falling WTI crude oil prices, balancing capital preservation needs against long-term growth opportunities. The market’s turbulence has triggered both defensive measures and selective investments across the industry.

Chevron and Eni’s Strategic Moves

Facing sustained price pressures, Chevron has implemented substantial cost-cutting measures, targeting up to $3 billion in savings while planning to reduce its workforce by approximately 8,000 employees [13]. The company requires a Brent price of $95 to cover both dividends and share buybacks, compared to Exxon’s $88 threshold [13]. If weak oil prices persist, analysts from several firms expect Chevron may scale back its share repurchase program, previously guided between $10-20 billion annually [13].

Meanwhile, Eni has maintained a proactive approach by expanding its global natural resources portfolio. The Italian energy giant recently acquired Chevron’s assets in Indonesia to accelerate development of the Gendalo and Gandang gas project with estimated reserves of approximately 2 trillion cubic feet [4]. This acquisition supports Eni’s energy transition strategy aimed at increasing natural gas production to 60% of its portfolio by 2030 [4].

Midstream Asset Sales in the Permian Basin

Private equity firms have actively divested midstream assets during the market volatility. Five Point Infrastructure is exploring the sale of Northwind Midstream, with valuations exceeding $2 billion including debt [30]. Similarly, Morgan Stanley Infrastructure Partners is shopping its controlling stake in Brazos Midstream II for more than $2 billion [31].

These transactions highlight the broader trend of private equity owners offloading infrastructure networks supporting U.S. shale production [30]. Permian Resources recently announced the divestiture of its natural gas and oil gathering systems to Kinetik Holdings for $180 million, allowing the company to “continue its relentless focus on being the Delaware Basin’s lowest cost operator” [32].

Domestic Drilling and Operating Adjustments

Diamondback Energy CEO Travis Stice warned shareholders that “U.S. oil production has likely peaked and will begin to decline this quarter” [33]. Baker Hughes data confirms this trend, showing the total rig count falling by 3 to 584 rigs, down 21 from last year [14]. Oil rigs specifically decreased by 4 to 479—20 fewer than the previous year [14].

Current prices have simply made drilling uneconomical for many operators. “The Permian Basin is not economic below $60 a barrel,” noted Michael Woods, president of Woods Operating [34]. This reality has prompted companies like Diamondback to reduce capital budgets by approximately $400 million to $3.4-3.8 billion for the year [33].

Conclusion

WTI crude oil’s descent below $62 marks a fundamental shift across global energy markets. The convergence of bearish factors has created exceptional downward pressure on oil prices. OPEC+’s aggressive production strategy, combined with the looming return of Iranian oil, has reshaped supply dynamics completely. Simultaneously, escalating trade tensions and disappointing economic indicators continue eroding demand forecasts worldwide.

Technical chart patterns only strengthen this bearish outlook. WTI trades well below critical moving averages while key support levels show signs of weakening. Though Brent crude maintains a marginally stronger position near $65, both benchmarks face substantial headwinds throughout 2025. Most market analysts now project WTI prices to remain suppressed in the mid-to-high $50s through the third quarter when trade disruptions reach maximum impact.

Major energy corporations have responded with practical measures to weather the downturn. Chevron has implemented extensive cost-cutting initiatives while Eni pursues strategic acquisitions centered on natural gas assets. Domestic drilling operations have contracted accordingly, with rig counts falling steadily and U.S. production likely peaking this quarter according to industry executives.

Investors should prepare for continued price volatility in coming months. JP Morgan’s recent downgrade of its WTI forecast to $62 from $69 reflects the challenging market reality, though geopolitical developments could quickly alter this trajectory. The market remains highly sensitive to developments in U.S.-Iran negotiations and ongoing OPEC+ compliance issues.

While current market conditions point toward sustained weakness, experienced oil industry participants recognize the sector’s historic cyclicality. This bearish phase will eventually transition toward rebalancing as production cuts, particularly from higher-cost U.S. shale operators, begin offsetting oversupply concerns.