WTI Crude Stabilizes After Sharp Selloff: Key Support Levels in Focus Amid Volatility

Yesterday’s Close: Settled at 70.58, down -3.25 [-4.40%]

WTI Crude Oil futures have steadied this morning after the past two days of sharp selling. November futures are trading down -0.17 to 70.39 and have traded close to unchanged through the overnight session. Israeli-related selling has now driven November WTI futures close to -$5.00 lower as risk-premia was retracted from futures pricing. 

The trade will continue to monitor the situation in the Middle East closely, but its focus will likely turn toward Chinese demand prospects and the 2025 balance sheet as the next catalyst. Global oil demand has faced consistent downward revisions in recent months and markets remain pessimistic despite Chinese stimulus.  

Call Options in Brent Crude Oil traded at a record volume yesterday. Also, in WTI Options, over 512 million barrels of crude oil options are set to expire Thursday. Implied Volatility and the call skew remain significantly elevated in both crude oil futures. 

WTI Crude Oil futures are stabilizing above rare major four-star support at 69.83-70.10 and per our note yesterday: “A settle above this point could provide a solid entry for risk-defined long positions. However, continued price action below our Pivot and point of balance at...

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