Oil News: Crude Futures Struggle Below $63.70 Pivot as Demand Concerns Mount

Crude Oil Slips as Trade War Escalation Undermines Tariff Relief Boost

Light crude futures are under pressure Thursday, paring back gains after a sharp intraday rebound the previous session. Traders attempted to build on momentum after prices found support near key technical levels between $56.19 and $53.09.

While Wednesday’s rally pushed prices above a former bottom at $59.31, they failed to clear the critical $63.70 pivot—an upside barrier that must be broken to unlock further gains toward the 50-day and 200-day moving averages at $68.65 and $69.73, respectively.

At 11:15 GMT, Light Crude Oil Futures are trading $60.75, down $1.60 or -2.57%.

Escalating US-China Trade War Weighs on Oil Demand Projections

President Trump’s announcement of a 90-day tariff pause for most countries briefly boosted crude, but the move excluded China, where tariffs jumped to 125% from 104%. In retaliation, Beijing imposed an 84% levy on U.S. goods. The tit-for-tat escalation deepens uncertainty over global demand, particularly from China—one of the largest crude importers.

Analysts from Panmure Liberum and UBS emphasized the increased risk to oil demand growth, noting that price weakness may be required to rebalance potential oversupply if consumption falters.

Supply Headlines Offer Limited Relief to Bearish Sentiment

News of the Keystone pipeline shutdown due to a spill in North Dakota offered limited support, with the operator declaring force majeure as assessments continued. Meanwhile, the Caspian Pipeline Consortium resumed loading at one Black Sea mooring after a temporary halt.

Yet, bearish sentiment was reinforced by a surprise U.S. inventory build—crude stocks rose by 2.6 million barrels last week, far above the 1.4 million barrel consensus, according to the EIA.

OPEC+ Output and Slowing Demand Undercut Rebound Potential

Traders remain cautious following OPEC+’s decision to raise output by 411,000 barrels per day in May—a move that could tip the market into surplus just as demand signals weaken.

ANZ Research warned that while a global recession isn’t their base case, it’s a rising concern, with $50/bbl flagged as a key support in a downside scenario. Broader global trade tensions, including EU tariffs on U.S. goods, only add to the bearish demand narrative.

Oil Prices Forecast: Bearish Bias Holds Below $63.70 Pivot

Crude’s inability to break above the $63.70 pivot confirms near-term resistance and stalls bullish momentum. Unless this level is decisively cleared, traders are likely to focus on the downside, especially with demand fears outweighing supply concerns. For now, the oil market outlook remains bearish.

More Information in our Economic Calendar.