Crude Oil Edges Higher but Faces Weekly Loss on OPEC+ and Geopolitics (April 25)

Summary

• Current price: $62.80 (Friday, Asia session)
• Trend: Short-term bounce, but medium-term downtrend remains intact
• Resistance Levels:
  • $63.40 – intraday resistance
  • $65.00 – a key psychological barrier
• Support Levels:
  • $61.50 – near-term support
  • $60.00 – critical support from late March lows

WTI remains vulnerable despite short-term gains, as oversupply and weak demand expectations cap upside momentum.

Fundamental Drivers

1. OPEC+ to Push for More Output
   • Multiple OPEC+ nations (including Kazakhstan) want to increase production again in June
   • Kazakhstan cited national interests and significant oil field constraints, refusing deeper cuts
2. Russia & Iran Could Boost Supply
   • Progress in Iran nuclear talks could ease sanctions, potentially reviving Iranian exports
   • A Russia-Ukraine ceasefire would likely increase Russian oil flows, adding to global supply
   • However, U.S. President Trump’s sharp rhetoric towards Putin may delay diplomatic resolution
3. Demand Outlook Remains Weak
   • Ongoing U.S.-China trade tensions threaten global growth
   • The prolonged dispute is pressuring the demand outlook from the two largest oil consumers
   • Slower trade, reduced manufacturing, and higher business costs = lower fuel demand

Key Takeaway for Traders

• WTI downside risks persist as both supply expansion and weak demand pressure prices.
• Commodity-linked currencies like the Canadian Dollar (CAD) and Norwegian Krone (NOK) may face headwinds if oil weakness extends.
• If WTI falls below the $60.00 support, expect USD/CAD to push higher and risk-sensitive FX pairs to underperform.
• A sustained drop in oil could also support the U.S. Dollar as global slowdown fears fuel demand for liquidity and safety.

XTIUSD – H3 Timeframe

Since the rejection from the daily timeframe support at the horizontal red line, XTIUSD has broken structure upwards twice on the 3-hour timeframe chart. Therefore, the current bearish move can be considered a necessary retracement for the price to garner the needed momentum to go higher.

XTIUSD – H1 Timeframe

The 1-hour timeframe chart of XTIUSD shows the elusive SBR pattern at the original demand zone of the double break of structure. Since the highlighted demand zone falls within the critical region of the Fibo retracement and possibly aligns with trendline support, we can conclude that it favors continued bullish movements.

Analyst’s Expectations: 

Direction: Bullish

Target- 65.76

Invalidation- 59.10

CONCLUSION

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