On Wednesday (February 19th) during the European trading session, WTI crude oil futures prices rose and traded near important levels. The intraday price was $72.48 per barrel, an increase of 0.90%. This level is below the 50 day moving average of $72.73.

Supply disruptions from Russia and the United States support oil prices

Oil prices are supported by tightening supply from Russia and the United States. The Caspian Pipeline Consortium (CPC) of Russia, which is the main export channel for crude oil from Kazakhstan, experienced severe supply disruptions after a pumping station was attacked by Ukrainian drones. This attack resulted in a 30-40% reduction in CPC oil flow, reducing the supply of up to 380000 barrels per day from the market.

In the United States, extreme cold weather has led to reduced production in North Dakota, with the state pipeline management agency estimating a daily decline of up to 150000 barrels. The combined effect of the Russian infrastructure attack and the weather induced production losses in the United States has consolidated the stability of oil prices near the critical $70 level.

The uncertainty of Russia's sanctions has made the market tense and uneasy

Traders are closely monitoring the relevant developments regarding possible changes in Russian sanctions. The United States is conducting diplomatic negotiations with Russia in Saudi Arabia, sparking speculation that some sanctions may gradually be lifted. However, given the ongoing geopolitical tensions, it seems unlikely to reach an immediate solution in the short term.

At the same time, the market is also evaluating the impact of broader supply side factors, including the production policies of the Organization of the Petroleum Exporting Countries (OPEC) and the development of the situation in Iran. The uncertainty of these geopolitical factors leads to market volatility and limits the space for significant fluctuations in oil prices.

Trump's tariff plan raises demand concerns

Despite supply disruptions providing upward support for oil prices, concerns about demand still exist. US President Trump announced plans to impose high tariffs on key industries worldwide, including a 25% tariff on automobiles and similar measures on semiconductors and pharmaceuticals. If these tariffs are implemented, they may slow down economic growth, weaken consumer spending, and reduce overall fuel demand.

Market outlook: bullish trend, but focus on key resistance levels

Supply constraints support the market, and the short-term outlook tends to be bullish. However, demand side risks, especially the potential economic slowdown caused by new trade tariffs, may limit the driving force for price increases. Traders should pay attention to further geopolitical developments and supply side disruptions to assess the next round of price trends.

technical analysis

WTI crude oil prices show a stronger bullish trend, fluctuating around the 50 day moving average (EMA50) of the index. It should be noted that the price is forming a positive pattern, which may help to continue the upward trend and break through the key resistance level of $72.30, thus opening up space for further increases in subsequent trading days. However, technical indicators have given negative signals, which may drive prices down again.