Oil Price Forecast: WTI Nears $100 as Saudi Arabia Reroutes Crude

• U.S. crude stocks fell by only 640,000 barrels last week, significantly below the expected 1.62 million barrel decline, suggesting weaker domestic supply tightening
• WTI holds key support at $97 with potential to reach $110 if it breaks above $105; Brent maintains support at $102 with upside target of $120 above $113 resistance
• The East-West pipeline repair timeline remains unclear and ongoing regional conflicts keep a risk premium in place, limiting downside despite the alternative export route

Oil Price Summary: WTI Approaches $100 Amid Saudi Supply Developments

Key Price Movements

Oil prices declined Thursday as WTI crude fell toward $101.30 (approaching the $100 level) while Brent dropped near $104.60, retreating from earlier highs near $110. Prices eased as immediate supply shortage concerns diminished.

Supply Situation

Saudi Arabia is offering additional crude to Asian refiners through ship-to-ship transfers near Oman, providing an alternative export route following the suspension of loadings at the Yanbu export hub. The East-West pipeline remains damaged with an unclear repair timeline, while regional fighting continues, maintaining some Middle East risk premium in prices.

Inventory Data

U.S. crude inventories fell by only 640,000 barrels last week, significantly below the expected 1.62 million barrel decline. This smaller drawdown suggests domestic supply is not tightening as rapidly as anticipated, prompting profit-taking.

Technical Outlook

WTI: Key support sits at $97, with a break below targeting $92.50. Resistance at $105 could propel prices toward $110. The price structure remains bullish short-term, though RSI indicates overbought conditions.

Brent: Critical support at $102 (break below targets $95), with resistance at $113. A breakout above $113 could drive prices to $120, potentially reaching $130-$135 longer term.

Market Implications

While Saudi Arabia's alternative export route may cap near-term gains, ongoing Middle East risks and technical support levels maintain a positive outlook. Fresh attacks or prolonged disruptions at Yanbu could quickly reverse the current decline and push prices higher.