Recap: The oil market traded lower on Thursday falling back to levels seen before the start of the Iran war following the signing of the U.S.-Iran interim deal to end the conflict on Wednesday. The 14 point memorandum of understanding beginning a 60-day negotiation period during which Iran will allow passage through the Strait of Hormuz. The deal calls for traffic through the waterway to be restored to its full capacity. The crude market sold off to a low of $73.58 by mid-morning as the market priced in a return of crude supplies from the Gulf. The market, however, bounced off its low and rallied to a high of $76.99 ahead of the close after U.S. Vice President JD Vance warned Israel against further attacks on Hezbollah in Lebanon, raising doubts over the U.S.-Iran ceasefire agreement. The July WTI contract settled down 19 cents at $76.60, while the August Brent contract settled up 30 cents at $79.85. The product markets ended the session in mixed territory, with the heating oil market settling down 6.73 cents at $3.1273 and the RB market settling up 8.53 cents at $2.9949.
Technical Analysis: The crude market will remain headline driven over the long Juneteenth holiday weekend. The market will likely focus on whether there is full compliance with the deal and on what happens in the Strait of Hormuz. It will likely continue to trend lower barring any problems with a full resumption of oil flows through the Strait of Hormuz. The oil market is seen finding support at $73.58, $71.64, $71.50, $70.56, $69.14, $68.28, $67.76 to $66.84. Meanwhile, resistance is seen at $76.99, $80.03, $81.15, $81.58, $82.42 to $83.20, $83.81, $86.33, $87.23, $88.85, $90.55 and $93.64.
Fundamental News: On Wednesday, U.S. and Iranian officials said U.S. President Donald Trump and Iranian President Masoud Pezeshkian on Wednesday digitally signed the memorandum of understanding aimed at ending the war with Iran. The memo had been signed digitally on Sunday by Vice President JD Vance and Iran’s chief negotiator Mohammad Baqer Qalibaf and witnessed by President Trump. Iran’s Foreign Ministry said the agreement was already in effect as of Wednesday. On Thursday, U.S. President Donald Trump said the U.S. expects “a complete ceasefire on all fronts,” including Lebanon, Hezbollah and Israel.
Iran’s Supreme Leader, Mojtaba Khamenei, said he had authorized a memorandum of understanding signed by the Iranian and U.S. Presidents, despite holding a different view, after receiving assurances from President Masoud Pezeshkian and other senior officials that Iran’s rights and the interests of the “Resistance Front” would be safeguarded.
OPEC maintained its forecast for strong global oil demand growth in the next four years and increased its longer-term view, citing a worldwide shift towards more supportive policies for oil use and saying there was no sign demand would peak. OPEC said in its 2026 World Oil Outlook that world demand will increase to 113.3 million bpd in 2030 from 105.1 million bpd in 2025. The 2025 figure is little changed, and the 2030 forecast unchanged, from last year’s report. For the longer term, OPEC expects world oil demand to reach 124 million bpd by 2050, up from 122.9 million bpd expected in last year’s report, and reiterated its view that there is no peak demand on the horizon. OPEC, however, said in the report U.S. output of tight crude, another term for shale, likely peaked in 2025 at just over 9 million bpd, and sees modest total U.S. liquids supply growth of 400,000 bpd until 2030 and a production plateau thereafter. The report expects production from countries outside OPEC+ to peak from the early 2030s. OPEC has been calling for more oil industry investment, and said the sector needs $17.7 trillion to be spent to 2050, compared with $18.2 trillion estimated last year.
Early Market Call – as of 8:40 AM EDT
WTI – July $75.75, down 81 cents
RBOB – July $2.9831, up 79 points
HO – July $3.1301, up 26 points
