Oil Prices Forecast - WTI Slides to $62.68, Brent at $66.68 as Oversupply and Weak Demand Weigh

WTI Crude (CL=F) Slides to $62.68 as Fed Cut Fails to Lift Demand

West Texas Intermediate futures ended the week at $62.68 per barrel, down 1.40% on Friday and shedding nearly 3.3% from weekly highs. The Federal Reserve’s first quarter-point rate cut of 2025 failed to generate a demand bump, with traders more focused on slowing U.S. economic activity. A glut of unsold housing units and weaker job creation data underscored the fragility of consumption, muting the effect of looser monetary policy.

Brent Crude (BZ=F) Settles at $66.68, Capping a Volatile Week

Brent crude futures finished at $66.68 per barrel, a 1.13% decline on the day. While both Brent and WTI posted back-to-back weekly gains, the rally faded as refinery turnaround season cut demand for crude feedstock. Analysts noted that the 4 million barrel jump in U.S. distillate stockpiles added bearish weight, sending futures back into the lower half of September’s trading range. Resistance continues to form near $65.62–$67.07, while key support levels sit at $61.45–$62.05, a zone repeatedly tested through the month.

Technical Stress Levels Define Market Direction

On weekly charts, WTI remains trapped within a broader July downtrend. A 6.8% rebound earlier in September to $66.01 failed to break trend resistance, reversing sharply into the $62 handle. Short-term ranges are compressed between $62.50–$64.74, with traders eyeing a breakout that could dictate the next leg. A close below $61.45 risks accelerating losses toward $58.19–$56.83, levels tied to 2025 lows and the 100% Fibonacci extension of June’s decline. Upside recovery requires a breach of $65.97, beyond which the 200-day average at $67.03 could open the path to $67.63.

OPEC+ Policy and Russian Exports Undermine Supply Tightness

Despite sanctions, Russian exports have yet to decline meaningfully, keeping supply robust. OPEC+ has begun scaling back its aggressive production cuts, adding more barrels into the market just as demand signals soften. Analysts emphasize that “robust supply” is overshadowing central bank easing. For traders, this means oil lacks the bullish catalyst normally delivered by rate cuts, instead facing downward pressure from both oversupply and falling refinery throughput.

Geopolitical Risks: Pipelines, Sanctions, and Energy Security

Pipeline politics added to volatility. Michigan’s Supreme Court reignited uncertainty around Enbridge’s Line 5, which carries 540,000 barrels per day through the Great Lakes, while the U.S. Supreme Court debates federal vs state jurisdiction over shutdown orders. In parallel, the EU accelerated its timeline to ban Russian LNG, adding friction to European energy supply. Meanwhile, Kazakhstan resumed exports via the BTC pipeline, easing temporary constraints. For traders in CL=F and BZ=F contracts, these cross-currents highlight how geopolitical tension alternates between bullish disruption risk and bearish overhang of unimpeded flows.

Macro Data and Refinery Season Pressure Consumption

Demand data continues to soften. The U.S. Energy Information Administration flagged weaker consumption trends, mirrored by a seasonal dip as refiners shut units for autumn maintenance. Analysts warn that refinery turnaround season, layered on top of macro softness, will further reduce crude intake in Q4. This coincides with bearish signals from distillate inventories, with stockpiles up sharply, suggesting weaker transport and industrial activity.

Comparative Commodities: Natural Gas and Gasoline Track Lower

Energy weakness wasn’t limited to crude. Natural gas prices slipped to $2.888 per MMBtu, down 1.74%, while gasoline futures fell to $1.971 per gallon, a drop of 2.02%. These declines reinforce the broad theme of softening demand across energy products, with traders exiting speculative longs as inventory builds accelerate.

Investor Sentiment and Speculative Positioning

CFTC data shows net long positions in crude at 98.7K contracts, a modest increase from 81.8K the prior week. Yet speculators are cutting exposure, with many fleeing oversupply concerns. Analysts highlight that hedge funds remain cautious, unwilling to chase rallies above $65. Futures action continues to mirror this skepticism, with failed breakouts leading to rapid reversals.

Insider Flows and Institutional Positioning

While oil itself lacks corporate insider data, investor flows reveal where capital is leaning. Hedge funds and commodity desks have reduced long exposure, while large trading houses remain active in physical crude, especially in arbitrage between U.S. Mars blend at $71.28 and Nigerian Bonny Light at $78.62. The spread reflects persistent supply imbalances, a theme that keeps traders nimble rather than long-biased.

Market Verdict: Oil Price Outlook — Bearish Bias With Tactical Bounce Risk

At $62.68 WTI and $66.68 Brent, crude prices hover just above make-or-break levels. Supply remains heavy, demand signals are deteriorating, and refinery season removes a key consumption pillar. Technical charts show downside targets into the high-50s if $61.45 breaks. While Fed easing could weaken the dollar and cushion oil in the medium term, fundamentals remain bearish. On balance, WTI (CL=F) and Brent (BZ=F) warrant a Sell stance in the near term, with tactical rebound potential only if resistance at $65.97 is cleared convincingly.

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