Crude Oil Rebounds Despite Inventory Surge
West Texas Intermediate (WTI) crude oil trades near $60.80 on Wednesday, up 1.0% for the day after dipping to the $60.00 region earlier. Despite bearish supply signals, the market attempts a rebound as traders await the official Energy Information Administration (EIA) inventory report later in the day.
The American Petroleum Institute (API) reported on Tuesday that U.S. crude oil inventories rose by 6.5 million barrels for the week ending October 31, following a 4.0 million-barrel draw the previous week. According to Oilprice’s calculations, U.S. inventories have posted a net gain of approximately 3.6 million barrels so far this year. Analysts at ING noted that these figures are “bearish for crude,” although sharp declines in gasoline and distillate inventories continue to support refined product margins, helping offset pressure on the broader oil complex.
On the geopolitical front, escalating tensions in the Black Sea region remain a key source of support for crude prices. Recent strikes on energy infrastructure—including refineries and processing facilities—have raised concerns about potential supply disruptions. These developments have reinforced the risk premium on energy markets, helping stabilize WTI despite bearish inventory data.
In the short term, confirmation by the EIA of another significant build in U.S. crude inventories could limit WTI’s recovery. However, ongoing geopolitical risks and resilience in refined product demand provide offsetting factors that may support prices near current levels.
WTI finds support around $59.90 on Wednesday, initiating a rebound toward the resistance zone near $61.00. The intraday price action reflects a continuation of the horizontal consolidation phase that has been in place since October 28, with prices oscillating between $59.50 and $61.30.
Upside targets: A breakout above $61.30 could open the path toward $62.50, followed by a potential rally toward the September high near $66.00
Downside risks: A decisive break below the 100-period Simple Moving Average (SMA) at $59.46 could expose the October 20 low near $56.00
WTI crude oil remains caught between bearish inventory signals and supportive geopolitical dynamics. While supply data may cap short-term gains, elevated risk conditions and refined product strength continue to provide a stabilizing force. Traders will closely monitor the EIA report and regional developments to assess the next directional move.