WTI tumbles to near $100.00 on surprise US inventory build despite supply disruption worries
- WTI price slumps to near $100.00 in Wednesday’s early European session.
- Crude oil inventories rose by 7.14 million barrels in the week ended September 11, API said.
- Traders remain glued to developments in the Middle East after an Iran-backed attack on Saudi Arabia’s East-West pipeline.
West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $100.00 during the early European trading hours on Wednesday. WTI falls after an unexpected build in US crude inventories. Traders continue to assess the developments surrounding the Middle East conflicts as Saudi Arabia suspended oil loadings at its Yanbu port.
US crude oil inventories see an unexpected weekly build, weighing on the WTI price. According to the American Petroleum Institute (API), crude oil stockpiles in the US for the week ending September 11 climbed by 7.14 million barrels, compared to a decline of 300,000 barrels in the previous week. The market consensus was for a fall of 1.8 million barrels.
Reuters reported on Tuesday that oil loadings at Saudi Arabia's Yanbu port had been paused after the world's biggest crude exporter shut its East-West pipeline following an attack by Yemen's Iran-aligned Houthis on Friday.
Saudi Arabia has used the pipeline to reroute around 4 million barrels per day, or about 4% of global supply, to the Red Sea port. US Energy Secretary Chris Wright stated on Tuesday that the closure was a brief interruption that will last days. Meanwhile, Andy Lipow, president of Lipow Oil Associates, said that “judging from the on-line pictures, it will take months to repair.” Concerns over supply disruptions could boost the black gold in the near term.
Oil balances tighten as Rabobank flags dwindling inventories and SPR strain
Analysts at Rabobank warn that the latest supply disruption is unfolding against an increasingly fragile backdrop, noting that "the new disruption comes as crude inventories continue to decline globally and SPRs are beginning to hit worrisome levels." In their view, this combination of falling stocks and strained strategic reserves underpins a structurally tighter market and reinforces their higher WTI price profile for the coming years.
Technical Analysis: WTI maintains a constructive outlook above the 100-day SMA
In the daily chart, WTI US Oil trades at $100.05. The near-term bias is bullish as price holds comfortably above the 100-day simple moving average (SMA) at roughly $85.36 and the 20-day Bollinger middle band around $90.05, indicating firm underlying demand after the recent pullback from the highs. The Relative Strength Index (RSI) hovers near 69, hinting at strong but increasingly stretched upside momentum as price approaches the upper Bollinger band.
On the topside, immediate resistance appears at the upper Bollinger band near $102.75, and a clear daily close above this barrier would open the way for a continuation of the uptrend. On the downside, initial support is seen at the Bollinger middle band around $90.05, with the 100-day SMA at $85.36 and the lower Bollinger band near $77.36 providing deeper levels where buyers could look to re-emerge if a corrective phase develops.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
