Recap: The oil market remained pressured on Tuesday following the market’s sharp sell off on Monday after U.S. President Donald Trump predicted that the war in the Middle East could end soon, lowering expectations of prolonged disruptions to oil supply. The oil market retraced some of Monday’s losses as it posted a high of $91.48 in overnight trading. However, the market erased its gains and extended its losses to over $18 as it posted a low of $76.73 in afternoon trading on the news that the head of the IEA, Fatih Birol, convened an extraordinary meeting of the group to assess market conditions, while the Group of Seven nations asked the agency to prepare scenarios for the release of emergency oil stockpiles. The market was further pressured after U.S. Energy Secretary said the U.S. Navy had successfully escorted an oil tanker through the Strait of Hormuz. The market later bounced off its low ahead of the close following reports that there was no U.S. escort of an oil tanker through the Strait of Hormuz. The April WTI contract ended the session down $11.32 at $83.45 and the May Brent contract ended the day down $11.16 at $87.80. The product markets also settled sharply lower, with the heating oil market settling down 24 cents at $3.3466 and the RB market settling down 16.81 cents at $2.6403.
Technical Analysis: The crude market on Wednesday is seen trending sideways, barring a major announcement. The market is seen holding its support at its lows as production shut ins are expected to continue, with current shut ins totaling more than 5 million bpd so far. It should be noted that while President Trump signaled a short-lived war, Iran’s Revolutionary Guards said they would not allow oil to be exported from the region if the U.S. and Israeli attacks continued. Shipping along the Strait of Hormuz will remain halted so long as passage through the waterway is deemed unsafe and so far the U.S. Navy has not been able to provide tankers with military escorts due to the risks. Also, even if the war ended soon, oil supplies would not immediately return to the market. The oil market is seen finding support at $76.73, $74.97, $73.28, $70.41 and $69.20 to $67.83. Meanwhile, resistance is seen at $91.48, $93.06, $98.11, $100.00, $103.15, $104.85, $107.41, $116.75, its high of $119.48, and $130.50.
Fundamental News: The EIA said Brent oil prices are set to remain above $95/barrel over the next two months as conflict in the Middle East rages on. Brent crude futures will then fall below $80/barrel in the third quarter of 2026, before falling to around $70/barrel by the end of the year. The effective closure of the critical chokepoint, the Strait of Hormuz, through which a fifth of global oil flows every day, will cause Mideast oil output to fall further in the coming weeks. The EIA added that those production shut-ins will gradually ease as transit resumes. It said higher oil prices are set to lead to more U.S. oil output and expects U.S. oil production to average 13.6 million bpd in 2026 and increase by 220,000 bpd to 13.83 million bpd in 2027. The new forecast represents an increase of about 500,000 barrels from the agency’s previous forecast. It raised U.S. retail gasoline prices by 43 cents from a previous forecast to $3.34/gallon in 2026 and $3.18/gallon in 2027. It raised its retail diesel price forecast for 2026 to $4.12/gallon, up 20.1% from its previous estimate.
The U.S. EIA reported that U.S. crude oil exports fell by 3% in 2025 from 2024, the first annual decrease since 2021. The U.S. exported 4.0 million bpd of crude oil, 85 times as much as in 2011, but slightly less than in 2023 and 2024. The EIA also noted U.S. exports decreased to Europe and the Asia and Oceania region, the two top regional destinations for U.S. crude oil. It added exports to Europe decreased by 7%, likely because increased output from OPEC replaced volumes from the U.S., while exports declined by 75% to Singapore and 89% to China. The annual decrease in exports comes despite a 3% increase in crude oil production to a record 13.6 million bpd. U.S. net imports of crude oil decreased to 2.2 million bpd in 2025 from 2.5 million bpd in 2024.
Early Market Call – as of 8:45 AM EDT
WTI – Apr $87.52, up $1.13
RBOB – Apr $2.7884, up 9.42 cents
HO – Apr $3.6683, up 26.98 cents
