West Texas Intermediate (OIL.WTI) crude rebounded 1.5% to $58.19 on Tuesday following Monday's 2% drop to its lowest level since February 2021. This modest recovery comes as Chinese buyers returned from a holiday, seizing opportunities at current low prices.
OPEC+ Pivot Drives Price Plunge
OPEC+ surprised markets by announcing a 411,000 barrels per day increase for June, nearly triple what was planned, marking their second consecutive month of accelerated production hikes. This strategic shift from defending prices to flooding the market has sent oil tumbling over 20% since April, when President Trump's tariff announcements heightened global economic concerns.
Forecasts Turn Bearish
Barclays lowered its 2025 Brent forecast to $70 per barrel, while Standard Chartered slashed its outlook by $16 to $61. Goldman Sachs and JPMorgan have similarly downgraded expectations amid recession fears.
Summer Relief for Drivers
Patrick De Haan of GasBuddy predicts national average gasoline prices in the USA will fall below $3 per gallon as refinery maintenance concludes, potentially boosting consumer spending power by tens of billions of dollars.
Big Oil Stays the Course
Despite market turbulence, major oil companies are maintaining growth strategies, with Exxon targeting 7% production increases and Chevron aiming for 9% growth in 2025.
OIL.WTI (D1)
OIL.WTI is trading near a previous low that previously triggered a sharp reversal followed by bearish trend continuation. Bulls need to break above $64 to gain momentum, while bears are likely to retest recent lows. The RSI is showing hidden bullish divergence (forming a higher low while the price forms a lower low), with the MACD exhibiting a similar pattern.
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