Crude oil trading reminder: Although inventory data has declined, oil prices remain range-bound. Pay attention to changes in demand expectations.
2025-10-30 10:41:44
International oil prices fell slightly during Asian trading hours on Thursday, failing to continue yesterday's gains. WTI crude oil traded around $60 per barrel, after its previous rebound was mainly driven by a significant unexpected drop in US inventories and sanctions.
Data released by the U.S. Energy Information Administration (EIA) showed that U.S. crude oil inventories fell by 6.9 million barrels last week, a drop far exceeding market expectations and marking the largest weekly decline in nearly two months.
Meanwhile, gasoline and distillate fuel inventories declined simultaneously, indicating that end-consumer demand remained strong. Driven by this data, oil prices briefly touched their intraday high, and short-term bullish sentiment in the market quickly intensified.
Meanwhile, Western countries have further escalated sanctions on Russian energy exports. US President Trump stated that he will continue to increase economic pressure on Moscow and implement even stricter energy restrictions.
Markets are concerned that restrictions on Russia’s main export routes could lead to supply shortages in European and Asian markets.
“The market is currently trying to assess the long-term impact of the additional sanctions, with the key being the actual reduction in exports.” – Emily Ashford, energy analyst at Standard Chartered Bank. In Asia, Indian state-owned refiners are beginning to reassess the feasibility of importing crude oil from Russia.
Some refineries have chosen to temporarily suspend purchases, while Indian Oil Corporation has stated that it will continue to purchase Russian oil as long as it complies with international sanctions.
Analysts point out that if Asian countries such as India adjust their import strategies, it will further disrupt the global crude oil supply and demand pattern in the short term. However, the sustainability of oil price increases is still constrained by multiple factors.
OPEC+ members will meet this weekend and are expected to approve a new round of production increases to address the previous tight supply situation in the market. If the production increase is approved, the upside potential for oil prices will be limited.
In addition, Federal Reserve Chairman Jerome Powell reiterated in his latest speech that "a December rate cut is far from a certainty," which means that monetary policy will remain cautious.
Markets expect that if interest rate cuts are delayed, US economic growth may slow, thereby weakening energy consumption demand.
Overall, the current oil price rebound is more of an emotional reaction to short-term inventory and policy events than a trend reversal. If inventories continue to decline and the impact of sanctions expands in the coming weeks, oil prices are expected to rise steadily in the medium term; conversely, if OPEC+ production increases and economic data weakens, oil prices may return to a range-bound trading pattern.
From a daily chart perspective, WTI crude oil found support at the $60 level after three consecutive days of decline, showing signs of a technical rebound. The price has climbed back above the short-term 5-day moving average, and the MACD indicator has formed a bullish crossover, indicating that short-term upward momentum is building.
The upper resistance level is at $61.80. A break above this level would target $63.50. The lower support level is around $59.80. A break below this level could lead to a retest of the $58 low. Overall, the structure suggests that oil prices may maintain a mild rebound in the short term, but the medium-term trend remains volatile.
Editor's Note:
While the recent oil price rebound was driven by a sharp drop in inventories and sanctions, this reflects more of a short-term market sentiment reaction than a fundamental shift in the supply-demand balance. Given the possibility of continued production increases from OPEC+ and the likelihood of the Federal Reserve maintaining a high-interest-rate cycle, the medium- to long-term trend of oil prices will remain constrained by the dual pressures of slowing global demand and increasing supply elasticity.
Data released by the U.S. Energy Information Administration (EIA) showed that U.S. crude oil inventories fell by 6.9 million barrels last week, a drop far exceeding market expectations and marking the largest weekly decline in nearly two months.
Meanwhile, gasoline and distillate fuel inventories declined simultaneously, indicating that end-consumer demand remained strong. Driven by this data, oil prices briefly touched their intraday high, and short-term bullish sentiment in the market quickly intensified.
Meanwhile, Western countries have further escalated sanctions on Russian energy exports. US President Trump stated that he will continue to increase economic pressure on Moscow and implement even stricter energy restrictions.Markets are concerned that restrictions on Russia’s main export routes could lead to supply shortages in European and Asian markets.
“The market is currently trying to assess the long-term impact of the additional sanctions, with the key being the actual reduction in exports.” – Emily Ashford, energy analyst at Standard Chartered Bank. In Asia, Indian state-owned refiners are beginning to reassess the feasibility of importing crude oil from Russia.
Some refineries have chosen to temporarily suspend purchases, while Indian Oil Corporation has stated that it will continue to purchase Russian oil as long as it complies with international sanctions.
Analysts point out that if Asian countries such as India adjust their import strategies, it will further disrupt the global crude oil supply and demand pattern in the short term. However, the sustainability of oil price increases is still constrained by multiple factors.
OPEC+ members will meet this weekend and are expected to approve a new round of production increases to address the previous tight supply situation in the market. If the production increase is approved, the upside potential for oil prices will be limited.
In addition, Federal Reserve Chairman Jerome Powell reiterated in his latest speech that "a December rate cut is far from a certainty," which means that monetary policy will remain cautious.
Markets expect that if interest rate cuts are delayed, US economic growth may slow, thereby weakening energy consumption demand.
Overall, the current oil price rebound is more of an emotional reaction to short-term inventory and policy events than a trend reversal. If inventories continue to decline and the impact of sanctions expands in the coming weeks, oil prices are expected to rise steadily in the medium term; conversely, if OPEC+ production increases and economic data weakens, oil prices may return to a range-bound trading pattern.
From a daily chart perspective, WTI crude oil found support at the $60 level after three consecutive days of decline, showing signs of a technical rebound. The price has climbed back above the short-term 5-day moving average, and the MACD indicator has formed a bullish crossover, indicating that short-term upward momentum is building.
The upper resistance level is at $61.80. A break above this level would target $63.50. The lower support level is around $59.80. A break below this level could lead to a retest of the $58 low. Overall, the structure suggests that oil prices may maintain a mild rebound in the short term, but the medium-term trend remains volatile.
Editor's Note:
While the recent oil price rebound was driven by a sharp drop in inventories and sanctions, this reflects more of a short-term market sentiment reaction than a fundamental shift in the supply-demand balance. Given the possibility of continued production increases from OPEC+ and the likelihood of the Federal Reserve maintaining a high-interest-rate cycle, the medium- to long-term trend of oil prices will remain constrained by the dual pressures of slowing global demand and increasing supply elasticity.
- Risk Warning and Disclaimer
- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
