Recap: The crude market on Tuesday continued on its upward trend as traders monitored the attacks on Saudi Arabia. Concerns over the vulnerability of Gulf energy infrastructure and shipping lanes remained in focus after Iran-aligned Houthis struck Riyadh’s international airport over the weekend and tanker attacks were reported near the Strait of Hormuz. The market was supported by news of an attack on the Yemen Oil Company in Sanaa. The reported attack came shortly after the Saudi-led coalition ordered the evacuation of the facility ahead of a military operation. The oil market traded to a low of $91.70 early in the morning before the market bounced off that level and never looked back. The market extended its gains to almost $1 as it traded to a high of $94.70 ahead of the close. The November WTI contract settled up 40 cents at $94.14. However, the December Brent contract settled down 96 cents at $105.69. The product markets settled in mixed territory, with the heating oil market settling up 21.12 cents at $4.9344 and the RB market settling down 4.16 cents at $3.2501.
Technical Analysis: The oil market will remain driven by concerns over the Houthi attacks on Saudi Arabia and their impact on oil flows from the Middle East. The market is seen finding support at $91.70, $89.61, $88.77, $87.96, $86.86, $85.92, $84.24, $82.47 and $82.17. Meanwhile, resistance is seen at $94.70, $94.74, $96.02, $96.54, $96.78, $97.22, $98.01, $100.61 and $101.69.
Fundamental News: The Organization of the Petroleum Exporting Countries lowered its forecast for 2026 oil demand growth to 180,000 bpd from a previous forecast of 380,000 bpd, marking the sixth straight downward revision. However, OPEC raised its forecast for world oil demand growth in 2027 to 2.55 million bpd from a previous forecast of 2.36 million bpd, citing the need for the world to rebuild inventories that have been depleted by the Iran war. OPEC also reported an increase of 900,000 bpd in oil production by the wider OPEC+ producer group to 39.07 million bpd in September, led by Saudi Arabia. The top OPEC producer told OPEC that it pumped 8.372 million bpd of crude in September, up more than 2 million bpd from August.
According to the Marine Minerals Administration, U.S. producers in the Gulf of Mexico shut in about 16.13% of the current daily oil production and 16.59% of the current daily natural gas production in response to Hurricane Isaias. It said personnel have been evacuated from five production platforms, representing 1.35% of the 371 manned platforms in the Gulf of Mexico.
According to data from the Department of Energy, U.S. crude oil stocks in the Strategic Petroleum Reserve were unchanged at 283 million barrels last week, their lowest level since 1982.
The U.S. Environmental Protection Agency proposed to make larger refiners blend more biofuels over the next two years, seeking to appeal to farm-state voters ahead of November’s congressional elections. The EPA proposed a rule to reallocate 100% of the renewable fuel volume obligations it waived for 29 small refineries announced at the end of August. The credits were waived for the 2025 compliance year. The EPA proposed two approaches and is seeking public comment. One would split the additional 2025 SRE volume evenly between the 2026 and 2027 compliance years, while the other would allocate all of it to 2027.
According to Vortexa, the U.S. blockade has kept Iranian crude exports at zero in October, after declining in the second week of September. In September, oil flows from the Gulf excluding Iran increased to over 81% of pre-war levels in September, led by a recovery in Saudi exports.
Early Market Call – as of 9:05 AM EDT
WTI – Nov $95.33, up $1.19
RBOB – Nov $3.2131, down 3.7 cents
HO – Nov $4.8794, down 5.5 cents
