Crude oil settled higher by 1.55% at 5,886, buoyed by renewed geopolitical tensions and seasonal demand optimism. Fresh Houthi attacks on Red Sea shipping lanes have stoked fears of potential supply disruptions at a time when investors are already weighing the impact of new US trade tariffs and rising OPEC+ output. President Trump reiterated sharply higher US tariffs will take effect from August 1, though he indicated the date may still shift, keeping markets on edge. Meanwhile, OPEC+ surprised markets by agreeing to raise production by 548,000 barrels per day (bpd) in August, higher than the 411,000 bpd monthly hikes of the previous three months. 

However, inventory trends paint a mixed picture. US crude stockpiles unexpectedly rose by 3.845 million barrels last week, counter to forecasts for a drawdown, while gasoline stocks surged by over 4 million barrels. Cushing hub inventories dropped by 1.493 million barrels and distillate fuels fell by 1.71 million barrels, providing some support. Longer-term, the IEA expects global oil demand to peak at 105.6 million bpd by 2029, diverging from OPEC’s outlook of continued growth. 

Technically, crude oil is under fresh buying momentum, with open interest jumping 11.03% to 13,719 lots and prices adding 90. Immediate support is pegged at 5,804, with a break below exposing 5,721. Resistance is seen at 5,942, above which prices may test 5,997. 

Source: Investing.Com

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