CL New York Crude Oil – Threats of sanctions against Russia and stabilizing trade tensions support oil prices

Oil prices closed higher on Wednesday as investors focused on US President Trump's demands for Russia to end the war in Ukraine and his tariff threats against countries purchasing Russian oil. U.S. crude oil futures rose 79 cents, or 1.14%, to settle at $70. Investors largely shrugged off the impact of U.S. crude and refined product inventory data. Trump said on Tuesday that if Russia shows no progress toward ending the war within 10-12 days, he would begin taking measures against Russia, including imposing 100% secondary tariffs on its trading partners, instead of the 50-day deadline he had previously set. He also said he would impose a 25% tariff on imports from India starting August 1 and would impose unspecified penalties on the country for purchasing Russian weapons and oil. The United States also warned China, Russia's largest oil buyer, that it could face significant tariffs if it continues to purchase Russian oil.

The U.S. Energy Information Administration (EIA) said U.S. crude oil inventories rose by 7.7 million barrels last week, compared with analysts' expectations in a Reuters poll for a 1.3 million barrel decrease. U.S. gasoline inventories fell by 2.7 million barrels, compared to expectations for a 600,000-barrel decrease. Distillate inventories, including diesel and heating oil, rose by 3.6 million barrels, compared to expectations for a 300,000-barrel increase.

As seen on the technical charts, oil prices have recently been trapped in a narrow range, and the overall trend remains uncertain. Upward movement is clearly constrained by the 250-day moving average, while downward support is found at the 100-day moving average. A clear break above the 250-day moving average at $69.05 suggests continued upward movement. Resistance is expected to continue at $70.50 to $72.50, and then towards $75. Support is expected at $69 and $67.60, with further support at $66.60 and the 100-day moving average at $65.20.

Forecast range:
Resistance: 70.50 - 72.50 - 75.00
Support: 69.00 - 67.60 - 66.60 - 65.20

This Week's Highlights:
EIA: U.S. Crude Oil Inventories Increased by 7.698 Million Barrels
EIA: U.S. Gasoline Inventories Decreased by 2.724 Million Barrels
EIA: U.S. Distillate Fuel Inventories Increased by 3.635 Million Barrels
EIA: U.S. Refinery Utilization Rate Decreased by 0.1 Percentage Point
EIA: U.S. Crude Oil Imports Increased by 1.317 Million Barrels Per Day

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