Oil News: Crude Nearing $63.34 Breakout Trigger Point on Supply Tightening

Oil Prices Climb Toward Key Technical Resistance on Iran Sanctions, OPEC Cuts

Light crude futures are advancing on Thursday, approaching a key pivot at $63.34. A confirmed breakout above this level would establish a short-term bottom at $55.12 and open the door to testing the 50-day moving average at $66.97, followed by the 200-day. These trend markers are the last technical barriers before the market could challenge the $72.28 high. Support remains in place at $59.23.

Fresh U.S. Sanctions on Iran Fuel Supply Concerns

Crude is on pace for its first weekly gain in three, supported by new U.S. sanctions targeting Iranian oil exports. The measures, announced Wednesday, include penalties against a China-based “teapot” refinery and are part of a broader effort to pressure Tehran over its nuclear program. Hawkish commentary from the U.S. Treasury reinforced concerns about global supply tightening, helping drive both benchmarks to their highest levels since April 3.

OPEC Secures Deeper Output Cuts

The Organization of the Petroleum Exporting Countries said Wednesday it had received updated plans from Iraq, Kazakhstan, and others to implement additional cuts after exceeding production quotas. These commitments are intended to bring production back in line with agreed targets and add further weight to the tightening supply outlook.

EIA Data Offers Mixed Signals on Supply

U.S. crude inventories rose by 515,000 barrels last week to 442.9 million, slightly above market expectations. The build occurred despite a sharp increase in crude exports, which surged 1.8 million barrels per day to 5.1 million—the highest in about a year. However, a large adjustment figure of 722,000 bpd in “unaccounted for crude oil” balanced the EIA data, dampening the drawdown impact from the export surge.

Refined product inventories offered a stronger bullish signal. Gasoline stocks fell by 2 million barrels, while distillates dropped by 1.9 million barrels to their lowest level since November 2023. Cushing inventories also declined by 654,000 barrels.

Oil Prices Forecast: Bullish Near-Term Outlook

With Iran sanctions tightening supply, OPEC cuts reaffirmed, and refined products showing solid draws, crude is positioned for further upside. A close above $63.34 would strengthen the bullish setup, especially if supported by continued export strength and inventory draws. Near-term bias remains bullish.

More Information in our Economic Calendar.