Oil Price Forecast: WTI (CL=F) Steadies Above $64 While Brent (BZ=F) Tests the $68–$70 Zone

Oil Price Forecast: WTI (CL=F) and Brent (BZ=F) between Oman diplomacy and tight supply

Where WTI (CL=F) and Brent (BZ=F) actually trade right now

U.S. crude WTI (CL=F) is holding in the mid-$60s. After a more than 2% slide to about $63.8 a barrel in Asian trade, price has been rotating around $64.2–$64.3, down from a previous close near $65.1 where the contract jumped just over 3% in a single session. Brent (BZ=F) sits in the upper-$60s, around $68.0–$68.6, also off roughly 1–2% after finishing the prior day close to $69.46 following a similar 3% spike. The market is oscillating inside a narrow band just under the psychological $70 line, with both CL=F and BZ=F repricing almost tick-for-tick as the news flow flips between escalation risk and talk of de-escalation.

US–Iran Oman talks: why the risk premium shrank but $70 Brent remains live

The confirmation that Washington and Tehran will meet in Oman on Friday immediately knocked more than 1% off WTI (CL=F) and Brent (BZ=F), because traders treated the headline as a short-term safety valve. WTI slipped toward $64.32 and Brent toward $68.60 once the Muscat venue and date were on the tape. Iran wants the discussions centred purely on the nuclear file. The U.S. is pushing to widen the scope to ballistic missiles, regional proxies and human-rights issues. That gap explains why the geopolitical premium has compressed but not disappeared.

Only a session earlier, comments out of Washington had pushed crude higher by roughly 3%, with Brent (BZ=F) jumping $2.13 to $69.46 and WTI (CL=F) rising $1.93 to $65.14 on fears the talks might collapse. Now the contracts have given back around $0.80–$0.90, not the full move. The market is effectively pricing a fragile truce: if Friday’s talks break down or turn hostile in public, BZ=F can be back at $70 in one move and CL=F will quickly chase it higher.

Strait of Hormuz and Iran’s 3.4 mb/d: the asymmetric supply risk in CL=F and BZ=F

The critical supply risk is not only Iran’s own output but its leverage over the Strait of Hormuz. Around 20% of global oil liquids transit that chokepoint daily. Iran currently ships roughly 3.4 million barrels per day, but the bigger threat is any disruption to tanker traffic, even if temporary. U.S. officials may avoid direct strikes on Iranian energy infrastructure, but Tehran still has the ability to rattle the market by threatening loadings or harassing ships.

If rhetoric shifts from talks to tanker threats, the risk premium comes straight back into the strip. A single high-profile incident near Hormuz would push Brent (BZ=F) several dollars higher and drag WTI (CL=F) with it, irrespective of what demand models or macro data say. That is why options markets still price upside shocks more expensively than downside protection.

US crude inventories and products: draws, distillate tightness and what it means for CL=F

The physical U.S. balance is tight enough to justify current price levels. Commercial crude stocks fell by about 3.5 million barrels to 420.3 million in the week ending January 30. That leaves inventories roughly 4% below the five-year average for this time of year. Gasoline stocks rose by only 0.7 million barrels, while distillates dropped sharply by 5.6 million barrels, pointing to firm demand for heating fuels and diesel.

Separate industry numbers highlighted an even larger crude draw of 11.1 million barrels, emphasising that the cushion evaporates quickly when refinery runs and exports align. With WTI (CL=F) trading around $64, the market is not behaving like there is a comfortable oversupply. The curve shape and the product tightness indicate that prompt barrels still command a premium.

Futures curve, options skew and WTI Midland: how the curve is flagging supply concern

Term structure backs that narrative. Contracts for near-date delivery in both CL=F and BZ=F are trading above later months in backwardation, a classic signal that buyers value nearby supply more than barrels further out. In the options market, call pricing remains richer than equivalent puts, proof that large accounts continue to pay for upside insurance against sudden spikes rather than position for a prolonged collapse.

On the export side, a record 1.9 million contracts of WTI Midland at Houston traded on one major venue in January. WTI Midland is a U.S. grade keyed to Gulf Coast export prices and competes head-to-head with Western Canadian Select and, increasingly, returning Venezuelan grades. The fact that liquidity in WTI Midland has exploded while geopolitical stress is high tells you that producers, refiners and traders are aggressively hedging both physical flows and price risk. That behaviour is not consistent with a market expecting crude to drift sustainably lower from the mid-$60s.

WTI (CL=F) technical structure: from December low to a rebuilt up-channel

The chart for WTI (CL=F) no longer shows a one-way downtrend. Price washed out into the high-$50s late last year, with a closing low near $59.29 and an intraday spike close to $56. From that point, CL=F has climbed more than 19% into late January, briefly trading above $70 before the current pullback. That move has carved out a rising channel starting at the December low, with both support and resistance now clearly defined.

A major technical shift came when WTI (CL=F) retook its 200-day exponential moving average around $62.6. That line rejected rallies for most of 2025. Now price is holding above it, and shorter-term moving averages are clustered underneath, acting as a platform rather than a ceiling. The structure is what you expect in a recovering market, not in a fresh bear leg.

Key support zones for CL=F: 61.44–62.07, 62.90 and the failure levels below

The first critical support pocket sits between 61.44 and 62.07. That band is defined by the April 2025 low-week close, the September swing low and the 38.2% retracement of the December advance. WTI just retested that region at the start of February and bounced hard, which validates it as the market’s first line of defence.

Just above, the October peak around 62.90 adds another reference. Recent trading saw CL=F drop into the 61.44–62.07 area, respect it intraday and then recover toward about 65.74, roughly 6.5% off the weekly low. As long as daily and weekly closes stay above 61.44, the December up-channel remains valid and the setback looks like a correction. A clean loss of 61.44 on a closing basis would flip the picture, opening the door toward 59.36 (the 61.8% retracement of the December move) and then the yearly open near 57.58 as realistic downside targets.

Upside ladder for WTI (CL=F): 66.40 first, then 67.86 and 70.63–70.91

On the topside, WTI (CL=F) is facing a stacked series of resistance levels. The immediate zone to watch is 66.08–66.40, where the 100% extension of the December rally lines up with the 2024 low-day close and a key September high. This cluster also sits just above the weekly and monthly open around 65.74, which means the whole 65.7–66.4 band functions as a decision area. A daily and then weekly close above 66.40 would confirm that the recent consolidation has been absorbed and the rally is resuming.

Once that band gives way, the next waypoint is 67.86, near the 50% retracement of the broader 2025 range. Beyond that, the heavy zone is 70.63–70.91, where a 1.618 Fibonacci extension meets the 61.8% retracement of the prior decline. If CL=F trades into 70.63–70.91, expect aggressive two-way activity as producers hedge and macro players test whether the market is willing to sustain a new leg above $70 or treat it as a selling area.

Channel and momentum in CL=F: ascending pitchfork and a constructive RSI profile

Shorter-timeframe charts show WTI (CL=F) moving inside an ascending pitchfork drawn off the December low. Price recently pressed into the upper 75% parallel, which explains why the market stalled around 65–66 and slipped back toward the low-$60s. The bounce from the 61.44–62.07 band confirms the lower side of the channel is still doing its job.

Daily momentum is consistent with that structure. RSI sits near 60, signalling firm upside energy without flashing a blow-off. The breakout above the 200-day EMA and above a descending trendline that capped price through late 2025 shows that sellers no longer control the medium-term trend. As long as CL=F prints higher lows above roughly $62, dips will keep attracting buying interest rather than triggering disorderly liquidations.

Brent (BZ=F) structure: trading just under $70 with skewed upside if talks fail

While WTI (CL=F) has already reclaimed its long-term average, Brent (BZ=F) is still oscillating just below $70. Current levels around $68.0–$68.6 mark only a modest pullback from the recent close at $69.46, when fears of failed diplomacy pushed the contract up by more than $2 in one session. The fact that confirmed Oman talks only shaved around $0.80–$0.90 off Brent tells you the market has not bought into a lasting thaw.

Strategists tracking BZ=F have been explicit: if the Muscat round on Friday ends badly, Brent can punch through $70 quickly, driven not by new demand but by repricing of route risk through Hormuz and by options hedging as call sellers cover. By contrast, a constructive meeting combined with benign U.S. inventory prints could drag BZ=F back toward the mid-$60s and pull WTI (CL=F) into the low-$60s, shifting focus from war premium back to refinery and demand dynamics.

Macro backdrop: higher policy rates, a firm dollar and the next US labour print

Oil is trading inside a macro regime dominated by higher-for-longer rates. With U.S. policy at 3.50–3.75% and officials signalling they are “not in a hurry to cut,” the dollar has remained firm and risk assets are under pressure. That environment caps upside for CL=F and BZ=F, because every uptick in yields tightens financial conditions and raises the hurdle for discretionary energy demand.

The next catalyst is the U.S. Employment Situation report due on Friday. Strong numbers would support the dollar and potentially weigh on commodities. Very weak data would raise recession fears, which also hurts the demand story even if rate-cut expectations increase. With crude already about 19% above December closing lows and sitting near $64–$69, any macro shock that threatens growth will be used to fade rallies unless geopolitical stress or inventory data move sharply the other way.

Positioning stance: CL=F and BZ=F skewed to tactical Buy rather than structural Sell

Taken together, WTI (CL=F) at roughly $64 and Brent (BZ=F) just under $69 do not trade like assets in a market that expects a collapse. CL=F has bounced 19% from a $59.29 closing low, recovered the 200-day EMA at $62.6, respected the 61.44–62.07 support pocket and is sitting just under a 66.08–66.40 resistance band that, once cleared, exposes 67.86 and then 70.63–70.91. Downside to a technical invalidation just beneath 61.44 is around $3, while upside to the first resistance zone is roughly $2–$3 and to the heavy $70.63–$70.91 area is about $6–$7. On that risk–reward profile, WTI (CL=F) fits a tactical Buy stance with tight risk levels below 61.44, not an outright Sell.

For Brent (BZ=F), trading near $68–$69 with a clear path through $70 if Oman diplomacy fails, the balance also favours Buy-the-dip rather than shorting into support. Strong U.S. draws, inventories roughly 4% below the five-year norm and a fragile shipping backdrop justify BZ=F near the upper-$60s. Provided mid-$60s support zones hold and there is no sustained collapse in demand indicators, the structure points to crude being priced as scarce and risky, not as a commodity heading for a deep and orderly grind lower.

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