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Facts:
- OIL.WTI falls back below the 50-day EMA
- The RSI for the last 14 days remains in the 50-point zone.
Recommendation:
Short position on OIL.WTI at market price
- Stop Loss: 60.90
- Target: 57.50
Opinion:
WTI crude oil is the weak spot in commodity markets, weighed down by a multi-layered oversupply that outweighs any potential supply risks. Fundamentally, the market is awash with significant surplus — the International Energy Agency forecasts that in the first quarter of 2026, the production surplus will reach nearly 4.9 million barrels per day, with global stocks remaining above the five-year average since July this year. OPEC+’s November decision to increase production by 137,000 barrels per day in December and then halt increases from January 2026 was already priced into market expectations and does not change the fundamental dynamics. The real pressure on prices comes from production outside the cartel — the US reached a record 13.8 million barrels per day in October, with shale production at 9.04 million barrels per day, accounting for 65% of total production. Large inventories observed in the fourth quarter of 2025 and the first quarter of 2026, averaging 2.7 million barrels per day, will act as a cushion, dampening possible price rebounds. The prospect of a potential easing of sanctions against Russia in the event of a peace agreement adds another layer of oversupply on the horizon. In such an environment, where fundamentals point to a continuing surplus of raw materials, we believe that the current downward trend in OIL.WTI is likely to continue.
The stop loss price was set slightly above the local highs of 18 November, while the take profit order was set in the area of the recent lows of the consolidation zone from the end of November. We recommend exercising particular caution due to the high volatility characterising this instrument.
Source: xStation
