Near $100.50: WTI hits new monthly high as Iran’s attacks on oil tankers continue

$100.50 is within reach as oil prices surge amid Iran’s ongoing attacks on tankers.
The Bab al-Mandeb Strait and Suez Canal could face an expanded blockade, Iran warns.
Russian oil infrastructure faces renewed Ukrainian strikes as Kyiv accuses the US of betrayal.

$100.50 is the level approached by West Texas Intermediate (WTI) futures on NYMEX. Up 2.5%, the contract is trading at its highest in over a month. Oil is now close to retesting $102.11, its almost five-month high.

Mounting energy supply risks are driving a sharp increase in oil’s risk premium. Iran continues to attack tankers attempting to transit the Strait of Hormuz, a critical chokepoint for almost 20% of global energy supply.

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Two tankers were set ablaze by mines and stopped south of the Strait of Hormuz, Reuters reported, citing Iran’s revolutionary guards’ navy. The navy gave no date for the incident.

Over the weekend, Iran said it was ready to retaliate against US-Israel attacks. It also warned that the blockade could be extended to the Bab al-Mandeb Strait and the Suez Canal.

Prospects for increased energy supply from Moscow have meanwhile been undermined by Ukraine’s continuing attacks on Russian oil refineries. According to NBC news, Ukraine resumed strikes on the refineries after President Volodymyr Zelenskyy angrily accused the United States of betraying Kyiv through a “dangerous” withdrawal of support essential to its defence against Russia.

WTI Technical Outlook

$100.49 is WTI US Oil’s price on the daily chart. A position above the 20-day exponential moving average (EMA), at $93.79, sustains the contract’s bullish near-term outlook. Despite recent volatility, the broader uptrend remains intact. At 66.38, the Relative Strength Index (14) is positive but below overbought territory. This points to supportive upward momentum, although it is becoming increasingly stretched.

The 20-day EMA at $93.79 provides the first downside support. Should a corrective pullback occur, buyers are likely to defend the prevailing trend there. Holding above this underlying demand zone favours buying dips rather than aggressive selling. Any consolidation would therefore likely be viewed as a pause in the broader advance, not a reversal of the trend.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

WTI Oil: Key Questions

WTI Oil Explained

Traded internationally, WTI is a grade of crude oil. Its name stands for West Texas Intermediate, which ranks alongside Brent and Dubai Crude as one of the three major types. Relatively low gravity and sulphur content earn WTI the descriptions “light” and “sweet”, respectively. Regarded as a high-quality oil, it is easy to refine. Production comes from the United States, with distribution through the Cushing hub, known as “The Pipeline Crossroads of the World”. WTI serves as an oil market benchmark, and its price features frequently in media coverage.

WTI Oil’s Main Price Drivers

Supply and demand determine WTI oil prices, as they do for other assets. Stronger global growth can lift demand, while weaker growth can have the reverse effect. Supply disruptions caused by political instability, war or sanctions can also affect prices. Another major influence is policy set by OPEC, a group of leading oil-producing countries. Because oil is predominantly traded in US Dollars, the currency’s value also matters for WTI crude. A weaker US Dollar can make oil more affordable; a stronger currency can have the opposite effect.

Inventory Data’s Effect on WTI Oil Prices

WTI oil prices respond to weekly inventory releases from the American Petroleum Institute (API) and the Energy Information Agency (EIA). Inventory movements capture changes in supply and demand. Falling stocks can signal stronger demand and lift oil prices, whereas rising stocks can indicate increased supply and weigh on prices. The API publishes its report every Tuesday, followed by the EIA the next day. The two releases typically give similar results: their figures are within 1% of one another 75% of the time. As the EIA is a government agency, its data is regarded as more reliable.

OPEC’s Role in WTI Oil Pricing

Production quotas for OPEC’s 12 oil-producing member nations are agreed collectively at meetings held twice a year. The group, whose full name is the Organization of the Petroleum Exporting Countries, often influences WTI oil prices through these decisions. Lower quotas can constrain supply and raise oil prices, while higher production has the reverse effect. The wider OPEC+ grouping brings in ten additional non-OPEC members, with Russia the most notable.