WTI Crude Oil dips below $60 as Gaza peace deal eases geopolitical risk
- WTI Crude Oil extends losses for the second day, briefly slipping to a five-month low on Friday.
- Risk premiums ease as Israel and Hamas approve the first phase of the Gaza peace deal.
- Bearish momentum remains intact on the daily chart, with WTI trading below key moving averages.
West Texas Intermediate (WTI) Crude Oil extends its slide for the second consecutive day on Friday, giving up all gains recorded earlier in the week as selling pressure intensified. At the time of writing, WTI trades around $59.80 after briefly slipping to its lowest level since May 8, around $59.21, losing more than 2% on the day.
The US benchmark is set for a second weekly decline as geopolitical risk premiums unwind following Israel and Hamas’ formal approval of the initial phase of the Gaza peace plan, under which Israel will start withdrawing troops while Hamas releases the remaining hostages.
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From a technical standpoint, the bias remains firmly bearish. Prices are holding below the 21, 50 and 100-day Simple Moving Averages (SMAs), all of which are now clustered in the $62.50-$64.50 zone, reinforcing a ceiling for near-term recoveries. The Relative Strength Index (RSI) hovers near 35, indicating that bearish momentum is strong but not yet oversold, leaving room for further downside.
Immediate support lies at $59.50. A decisive break below this zone would expose the May 8 swing low at $57.47, followed by this year’s trough near $55.00. On the upside, WTI faces initial resistance at the psychological $60.00 handle, where sellers are expected to cap intraday rebounds. A move beyond that could open a corrective path toward $61.50, though upside attempts may remain short-lived as long as prices stay below the key moving averages.
Overall, the broader setup continues to favor sellers, with the market structure pointing to lower highs and lower lows and momentum indicators confirming a sustained bearish bias. Unless WTI reclaims the mid-$62 zone with strong follow-through, the path of least resistance remains to the downside.
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.