WTI Oil Eyes a Bullish Bounce but Bearish Pressure Remains in Play

[Ben Graham]

Most Read:

Oil prices went up on Wednesday after the American Petroleum Institute reported a drop in U.S. crude stockpiles. Investors are also watching for updates on efforts to end the Ukraine war, with sanctions on Russian oil still in effect.

US Crude Stockpiles Drop

The American Petroleum Institute (API) reported that U.S. crude stocks fell by 2.4 million barrels last week, more than the expected 1.2 million-barrel drop, showing stronger demand. Official data from the U.S. Energy Information Administration (EIA) will be released later today.

Other Factors Impacting Oil Prices

Oil prices have been holding out hope of a Russia-Ukraine peace deal.

On Tuesday, Trump said the U.S. might offer air support as part of a deal to end the Russia-Ukraine war.

The day before, he mentioned plans to set up a meeting between Putin and Ukraine's President Zelenskiy, followed by a three-way summit with all three leaders. However, Russia has not confirmed its participation in talks with Zelenskiy.

As things stand, a quick deal seems unlikely given that according to reports, if Ukraine is to give up territory, this will need to happen via a public vote.

At present Oil prices may also be finding support from flooding at a large U.S. refinery. BP announced on Tuesday that its Whiting, Indiana refinery, which processes 440,000 barrels per day, was impacted by flooding caused by a severe thunderstorm. This could reduce crude demand at the refinery, which is an important fuel supplier for the Midwest.

Moving forward, EIA data will be key later in the day with any updates on the Russia-Ukraine peace deal may also stoke some volatility.

For all market-moving economic releases and events, see the MarketPulse Economic Calendar. (click to enlarge)

Technical Analysis - WTI Oil

From a technical analysis standpoint, Oil has broken below the triangle pattern and the 200 and 100-day MA resting around the 67.62 and 64.51 handles respectively.

Price action is rather choppy on the daily timeframe with a bearish day followed by a bullish one.

A clear sign of the uncertainties and lack of commitment from traders at present.

WTI Oil Daily Chart, August 20, 2025

Source: TradingView (click to enlarge)

Dropping down to a two-hour timeframe and the 100-day MA in purple has been providing a strong area of dynamic resistance this week.

However, we have seen a break of the previous swing high a short while ago which could hint at a change in structure.

My concern however stems from the period-14 RSI on the two-hour chart which has been rejected at the 50 neutral level. A break above this level would have signaled a shift in momentum but a failure to do so hints that bearish momentum is still very much in play.

WTI Oil Two-Hour Chart, August 20, 2025

Source: TradingView (click to enlarge)

Follow Zain on Twitter/X for Additional Market News and Insights @zvawda

Opinions are the authors'; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. The provided publication is for informational and educational purposes only.
If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please refer to the MarketPulse Terms of Use.
Visit https://www.marketpulse.com/ to find out more about the beat of the global markets.
© 2025 OANDA Business Information & Services Inc.