Crude oil prices surged by 3.81% to 6,161, driven by investor concerns that escalating tensions in the Middle East could disrupt oil flows from the region. The possibility of Israel targeting Iranian oil infrastructure raised fears of potential retaliation from Iran, further intensifying market anxiety. These concerns were slightly offset by a stronger global supply outlook, as OPEC has spare capacity to compensate for any disruption, including a full loss of Iranian oil supply. Kazakhstan is set to reduce its oil output in October due to scheduled maintenance at the Kashagan field, in line with OPEC+ agreements.
Russian Deputy Prime Minister Alexander Novak reaffirmed OPEC+’s role in stabilizing the global oil market, emphasizing that the group had contributed significantly to Russia's budget since 2016. In the U.S., crude oil inventories rose by 3.889 million barrels for the week ending September 27, 2024, against market expectations of a 1.3 million barrel decline. Stocks at the Cushing delivery hub increased by 0.840 million barrels, while gasoline inventories grew by 1.119 million barrels. Distillate stockpiles fell by 1.284 million barrels, below the forecasted 1.5 million drop. Meanwhile, China's crude oil imports in August dropped by 7% year-on-year, reflecting weak demand and refining margins, though imports improved from July.
Technically, crude oil is under fresh buying, with open interest rising by 1.12% to 14,659 contracts as prices gained 226. Support is now at 5,995, and a move below this level could see prices test 5,828. Resistance is expected at 6,270, with a move above potentially leading to 6,378. The market remains sensitive to geopolitical tensions and supply dynamics.