Crude Oil Radar

2025-10-09 23:50

Table of Contents

Brian's Thoughts

Published: 10/09/2025 Focus: Crude Oil
The oil market has been thinking we have too much supply on the market - and they are right but in a different lens than most think. Supply/Demand balances have been much better globally than traders are giving credit. Inventories globally have been very healthy indicating that we have solid demand for our current level of supply. Into this winter and first quarter of 2026 (normally a very bearish time frame - just due to seasonal demand), OPEC+ is releasing more barrels into the market +137,000 bopd for November (and likely every month there after for 12 months). Balance this with a sharp inventory increase in Diesel in the US - and we may have the canary in the coalmine - how quickly it is increasing is an indication of reduced industrial activity and possibly farm activity (due to lower demand from tariffs). Capping off the fundamentals - we are balanced today but need demand increases in 2026 to remain balanced. Technicals are right at the key support/resistance level of 61.64 - this is the last line of support before dropping to the 50s. My stance remains that I think we drop into the 50s and then in 2026 start a long term structural increase in crude demand and crude prices. 61.64 is likely to fall

Today's Update

Updated: 2025-10-09 23:46:40 Length: 480 chars
Crude oil markets are currently navigating a delicate balance. While global supply appears ample, inventories suggest strong demand, countering bearish market sentiments. OPEC+ plans to increase output by 137,000 bopd monthly may further influence supply dynamics. However, sharp diesel inventory increases in the U.S. hint at potential industrial slowdowns. Technical levels indicate crucial support at $61.64; a breach could send prices into the 50s. Watch for demand shifts ...

Market Summary

Technical Outlook

Moderately Bearish
Score: -3/5
Short: SELL | Medium: SELL | Long: SELL

International Prices

Brent: $66.25 $0.8
WTI: $62.55 $0.82
Spread: $3.7 (Brent premium of $3.70)

Key Fundamentals

Crude Stocks: N/A (0)
Net Imports: N/A (0)

News Sentiment

BEARISH

Spec Positioning

Net Position: 26,483
Weekly Change: 10,316

Technical Analysis

Overall Technical Score (-5 to +5): -3 (Moderately Bearish)
Current Price: $61.49
Signal: Moderately Bearish

Moving Averages (9/20)

BEARISH

MA(9): $61.82

MA(20): $62.95

Current Price is 61.49, 9 day MA 61.82, 20 day MA 62.95

MACD (12, 26, 9)

BEARISH

MACD: -0.6039

Signal: -0.4775

Days since crossover: 7

MACD crossed the line 7 days ago and is in a bearish setup

RSI (14)

NEUTRAL

Value: 43.37

Category: NEUTRAL

RSI is 43.37 (note 70% is overbought and 30% is oversold)

Volume (vs 20d Avg)

LOWER

Current: 5,665

Avg (20d): 226,169

Ratio: 0.03

Volume is lower versus 20 day average

Stochastic (14, 3)

BEARISH CROSS

%K: 18.11

%D: 25.3

Stochastic %K: 18.11, %D: 25.3. Signal: bearish cross

ADX (14)

NO TREND

ADX: 12.48

+DI: 18.87

-DI: 24.57

ADX: 12.48 (+DI: 18.87, -DI: 24.57). Trend: no trend

Williams %R (14)

OVERSOLD

Value: -81.89

Williams %R: -81.89 (oversold)

Bollinger Bands (20, 2)

BELOW MIDDLE

Upper: 65.72

Middle: 62.95

Lower: 60.18

Price vs BBands (20, 2): below middle. Upper: 65.72, Middle: 62.95, Lower: 60.18

Fundamental Analysis

Category Current Last Week Last Year 3 Yr Avg
Crude Production (Thousand Barrels a Day) 13629.0 13505.0 13300.0 12833.33
Crude Imports (Thousand Barrels a Day) 6403.0 5833.0 6628.0 6210.33
Crude Exports (Thousand Barrels a Day) 3590.0 3751.0 3878.0 3244.33
Refinery Inputs (Thousand Barrels a Day) 16297.0 16168.0 15691.0 15492.0
Net Imports (Thousand Barrels a Day) 2813.0 2082.0 2750.0 2966.0
Commercial Crude Stocks (Thousand Barrels) 420261.0 416546.0 416931.0 428687.33
Crude & Products Total Stocks (Thousand Barrels) 1694142.0 1695087.0 1649630.0 1636291.0
Gasoline Stocks (Thousand Barrels) 219093.0 220694.0 221202.0 216683.67
Distillate Stocks (Thousand Barrels) 121559.0 123577.0 121637.0 113844.67

International Price Analysis

International Price Summary

Brent crude (DEC 25) settled at $66.25, change $+0.8. WTI crude (NOV 25) settled at $62.55, change $+0.82. The Brent-WTI spread is currently $3.7 (Brent premium of $3.70). The Brent-WTI spread reflects differences in global vs. U.S. supply/demand dynamics, geopolitics, and transportation costs.

Brent Crude

$66.25
0.8
(DEC 25)

WTI Crude

$62.55
0.82
(NOV 25)

Brent-WTI Spread

$3.7
Brent premium of $3.70

OPEC Analysis

OPEC Market Analysis

Executive Summary:

The current OPEC market situation reflects a slight decline in crude oil prices, with the OPEC Reference Basket averaging $69.73/b in August. Despite this, global oil demand is projected to grow steadily, particularly in non-OECD regions, while production levels are expected to rise, particularly from Non-DoC countries.

Key Market Metrics:

Category Production (mb/d) Demand (mb/d)
World Production 105.135 105.135
Non-DoC Production 51.439 N/A
DoC Production 42.40 N/A

Supply-Demand Balance Analysis:

The balance between global oil production and demand indicates a stable market with no significant surplus or deficit. Total world demand is projected at 105.135 mb/d, matching the production levels, suggesting a well-balanced market environment.

Production Landscape:

Major producers include the US, Brazil, and Canada, with Non-DoC production expected to grow by 0.8 mb/d in 2025. OPEC countries participating in the DoC have also seen an increase in production, averaging 42.40 mb/d, indicating a robust response to market conditions.

Demand Patterns:

Global oil demand is forecasted to grow by approximately 1.3 mb/d in 2025, driven primarily by non-OECD countries, particularly China and India. This growth is crucial for maintaining market stability amidst fluctuating production levels.

Non-DoC vs DoC Analysis:

Non-DoC production is projected to reach 51.439 mb/d, significantly higher than DoC production levels of 42.40 mb/d. This highlights the increasing role of non-OPEC producers in the global oil market, potentially impacting OPEC's influence on pricing and supply dynamics.

OPEC's Strategic Position:

OPEC's current market position remains strong, with stable production levels and a strategic focus on balancing supply with growing demand. The organization is likely to continue its cooperative strategies to manage production levels effectively, ensuring market stability.

Forward-Looking Indicators:

In the coming months, market developments are expected to be influenced by ongoing demand growth in non-OECD regions, alongside potential production adjustments from both OPEC and Non-DoC producers. Monitoring these trends will be crucial for anticipating price movements.

Key Insights and Recommendations:

  • Monitor the production levels of Non-DoC countries as they continue to grow, impacting global supply dynamics.
  • Stay informed on demand trends in emerging markets, particularly in Asia, which are driving overall growth.
  • Consider the implications of OPEC's production strategies on pricing and market stability.
  • Evaluate the potential for increased volatility in crude oil prices due to speculative trading behaviors.
  • Prepare for adjustments in refining operations as global demand patterns evolve.

CFTC CoT Analysis

Sentiment: Bullish but Weakening
Positioning: Normal Range
Report Date: 2025-09-23

Managed Money

26,483
Change: -10,316
1.4% of OI

Producer/Merchant

283,712
Change: -9,029
14.6% of OI

Swap Dealers

-402,312
Change: +5,178
-20.8% of OI

Open Interest

1,936,690
Change: -25,930

Summary Analysis:

CFTC Commitment of Traders Report (Disaggregated) as of 2025-09-23

Crude Oil Positioning (WTI-PHYSICAL - NYMEX):

Open Interest: 1,936,690 contracts (-25,930)

Managed Money Net Position: 26,483 contracts (1.4% of OI)

Weekly Change in Managed Money Net: -10,316 contracts

Producer/Merchant Net Position: 283,712 contracts

Swap Dealer Net Position: -402,312 contracts

Market Sentiment (based on Managed Money): Bullish but Weakening

Positioning Analysis (Managed Money): Normal Range

Key Takeaways:

- Managed Money traders are large speculators, often driving price trends in Crude Oil.

- Producer/Merchant positions primarily reflect hedging activity.

- Swap Dealers act as intermediaries.

- Extreme positioning by Managed Money can indicate potential market reversals.

- CFTC data reports positions as of the report date, usually released each Friday.

About Disaggregated CoT Reports:

The Disaggregated CoT report provides a more detailed breakdown of futures market open interest.

It categorizes traders into: Producer/Merchant/Processor/User (Commercials), Swap Dealers, Managed Money (Speculators), and Other Reportables.

News Analysis

Market Sentiment Overview

BEARISH
Average Polarity: -0.4
Confidence: 1.0
Articles Analyzed: 65
Last Updated: 2025-10-09 23:49:42

Commodity Sentiment

CRUDE_OIL

-0.4

Top News Topics

Supply (12 articles)

Demand (3 articles)

Geopolitical (3 articles)

Economic Analysis

Economic Sentiment Summary

POSITIVE - Economic indicators generally supportive
Dollar Impact: Strong USD may pressure commodity prices
Industrial Demand: Strong industrial demand signals
Interest Rate Impact: Rising rates may impact energy demand
Risk Sentiment: Low market volatility/risk appetite

Economic Indicators

USD_INDEX

99.31
Daily: 0.46 (0.46%)
Weekly: 1.59 (1.63%)

US_10Y

4.15
Daily: 0.02 (0.46%)
Weekly: 0.03 (0.7%)

SP500

6735.11
Daily: -18.61 (-0.28%)
Weekly: 19.32 (0.29%)

VIX

16.43
Daily: 0.13 (0.8%)
Weekly: -0.22 (-1.32%)

GOLD

3983.8
Daily: -59.5 (-1.47%)
Weekly: 103.0 (2.65%)

COPPER

5.1
Daily: 0.05 (0.99%)
Weekly: 0.04 (0.75%)

Fibonacci Analysis

Current Price: $61.49
Closest Support: $60.4 1.77% below current price
Closest Resistance: $62.79 2.11% above current price

Fibonacci Retracement Levels

0.0 $60.4 Support
0.236 $62.79 Resistance
0.382 $64.26
0.5 $65.46
0.618 $66.65
0.786 $68.35
1.0 $70.51

Fibonacci Extension Levels

1.272 $73.26
1.618 $76.76
2.0 $80.62
2.618 $86.87

ML Price Prediction

Current Price: $61.51
Forecast Generated: 2025-10-09 23:49:44
Next Trading Day: DOWN 0.08%
Date Prediction Lower Bound Upper Bound
2025-10-10 $61.46 $59.47 $63.44
2025-10-11 $61.38 $59.39 $63.36
2025-10-12 $61.34 $59.35 $63.32
2025-10-13 $61.36 $59.38 $63.35
2025-10-14 $61.42 $59.44 $63.41

ML Insights

  • Forecast generated using ARIMA(5, 1, 0).
  • The model predicts a price decrease of ~0.08% for the next trading day (2025-10-10), reaching $61.46.
  • The 5-day forecast suggests relatively stable prices between 2025-10-10 and 2025-10-14.
  • The average confidence interval width is ~6.5% of the predicted price, indicating model uncertainty.
  • SIGNAL: Bearish signal, moderate uncertainty.

AI Analysis

💹

For Energy Traders:

The recent price movements indicate a bearish sentiment, with the OPEC Reference Basket dropping to an average of $69.73/b. The Brent-WTI spread has widened to $3.70, reflecting differing supply/demand dynamics. This widening spread suggests potential short-term opportunities for traders who can navigate the volatility.

Given the market's backwardation structure, traders should monitor support levels around $64.00 (WTI) and $67.00 (Brent) for potential bounce-back opportunities. However, the increasing net short positions from hedge funds could lead to further downward pressure.

⛽

For Producers (Oil & Gas Companies):

With global oil demand growth forecast remaining steady at about 1.3 mb/d for 2025, producers should consider this stable demand when planning production levels. However, the increase in OECD commercial crude stocks indicates a potential oversupply situation, which may necessitate adjustments in production strategies to avoid excess inventory.

Hedging strategies should be revisited, particularly given the bearish market sentiment and the potential for further price declines. The current market structure emphasizes the need for proactive inventory management to mitigate risks associated with fluctuating prices and demand uncertainties.

🏭

For Consumers (Industrial/Refineries/Transportation):

The current market conditions suggest potential input cost fluctuations, particularly with WTI trading at $62.55 and Brent at $66.25. Consumers should be aware of supply reliability risks, especially given geopolitical tensions and increasing crude inventories which could impact procurement strategies.

It is advisable for consumers to consider hedging strategies to manage costs effectively in this volatile market. The recent uptick in US crude imports may provide some stability in supply, but ongoing geopolitical risks remain a concern for long-term planning.

📊

For Commodity Professionals (Analysts, Consultants):

The Crude Oil market is currently influenced by a mix of bearish sentiment and stable demand forecasts. The bearish outlook is reinforced by heavy speculative selling and increasing net short positions among hedge funds. However, the backwardation in major benchmarks indicates underlying physical market strength.

Analysts should focus on the divergence between supply and demand dynamics, particularly in the OECD versus non-OECD regions. The current market conditions suggest a cautious approach to forecasting, as external factors such as geopolitical tensions and economic growth rates could significantly shift the outlook.

Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Please consult with a financial advisor for specific investment strategies.

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