Recap: The crude market eased off further, settling down 0.9% after U.S. officials downplayed the need for renewed military action against Iran. U.S. Secretary of State Marco Rubio told Group of Seven allies that the U.S. economic sanctions and naval blockade were working, adding that the U.S. did not need to conduct major combat operations against Iran. On Monday, President Trump said he was holding off new military strikes against Iran following appeals from countries in the Middle East. The crude market posted a high of $86.93 and continued on its downward trend in overnight trading, posting a low of $83.88. The market, however, retraced some of its losses after Iran’s top security official said there were currently no negotiations taking place between Iran and Washington. The December WTI contract settled down 81 cents at $86.04 and the January Brent contract settled down $1.08 at $91.49. Both crude benchmarks settled at their lowest level since August 31st for a second day. Meanwhile, the product markets ended the session lower, with the heating oil market settling down 8.39 cents at $4.1309 and the RB market settling down 4.21 cents at $2.6088.
Technical Analysis: The oil market will likely retrace some of its recent sharp losses and trade in its recent trading range. The market will likely find some support in the weekly petroleum stocks reports, which are expected to show draws in crude stocks of over 1 million barrels for the week ending November 6th. The market’s gains will be limited so long as the U.S. continues to downplay the likelihood of military strikes against Iran. It will have to be seen whether negotiations between the U.S. and Iran can continue given that Iran has stated that it would not continue talks unless Washington complies with its conditions. The crude market is seen finding support at $83.88, $83.15, $82.08, $80.50 to $80.17. Meanwhile, resistance is seen at $86.93, $91.42, $91.94, $92.53, $94.44, $96.93, $97.15 and $98.82.
Fundamental News: In its Short Term Energy Outlook, the EIA said U.S. crude production is expected to reach a record high for the fourth straight year in 2026. U.S. oil production is forecast to reach 13.9 million bpd this year, up from 13.7 million bpd in 2025. U.S. crude output is then set to increase again in 2027 to 14.3 million bpd. World oil output in 2026 is forecast at 101.7 million bpd, up 600,000 bpd from a previous forecast, while output in 2027 is expected to increase to 108.4 million bpd, down from a previous estimate of 109.6 million bpd. World oil demand in 2026 is seen at 102.4 million bpd, unchanged from a previous estimate, while output in 2027 is forecast at 104.4 million bpd, down from a previous forecast of 104.6 million bpd. U.S. oil demand is seen at 20.6 million bpd, unchanged from a previous forecast, while demand in 2027 is seen at 20.9 million bpd, up from a previous forecast of 20.8 million bpd. The EIA said Brent crude prices are set to average $97/barrel in 2026, before falling to $86/barrel in 2027.
Shipping data showed that a tanker carrying the first cargo of Russian diesel for the United States has come to a halt off the U.S. east coast, with its operator saying its destination had not yet been decided. The Malta-flagged tanker Agioi Fanendes was loaded with 40,000 metric tons or 300,000 barrels of ultra low sulfur diesel in Russia’s Baltic port of Primorsk on October 22nd, with an expected delivery date of November 7th. However, the Greece-based company which manages Agioi Fanendes, Eastmed, said a week later that the vessel was proceeding awaiting orders and that a port of discharge had not yet been nominated or finalized. Bloomberg reported that the tanker has been sailing off the East Coast since Monday after making a U-turn about 400 nautical miles off New York. New Jersey’s Governor Mikie Sherrill this month warned local port officials and terminal operators against accepting Russian diesel, saying those shipments would break federal law. She said importing Russian diesel could expose businesses and individuals using New Jersey ports to “harsh” civil and criminal penalties.
Early Market Call – as of 8:30 AM EDT
WTI – Dec $87.31, up $1.28
RBOB – Dec $ 2.6022, down 66 points
HO – Dec $4.2144, up 8.35 cents
