Crude Oil Trading Alert: Geopolitical Conflict Marginal Impact Weakening Combined with Unexpected U.S. Inventory Surge, WTI Oil Price Approaches $95 with Rising Risk of Near-Term Peak

Huitong Finance APP News — On Wednesday during Asian trading hours, WTI crude oil prices remained around $94, fluctuating slightly. Despite the ongoing escalation of tensions in the Middle East, the rally in oil prices has noticeably slowed, indicating a shift in market reaction to geopolitical conflicts. The market has gradually transitioned from a “highly sensitive” response to a “marginally dulled” one, which is one of the most significant changes in the current crude oil market.

According to market surveys, Iran recently launched strikes against oil production facilities in the UAE and Iraq, marking the first direct targeting of upstream production since the conflict began. This event temporarily heightened concerns over supply disruptions. However, from the price action, oil has not experienced sustained unilateral gains; instead, it has oscillated around high levels, suggesting that geopolitical risk premiums have already been largely priced in during previous increases.

Meanwhile, Israel announced that a key Iranian security official was killed in an airstrike, further fueling expectations of an escalation in the conflict. However, market behavior shows a shift from “chasing gains” to “taking profits on rallies.” In other words, the bullish factors driven by geopolitical tensions are gradually being absorbed by the market, even triggering some long positions to lock in profits.

From a supply and demand fundamental perspective, US inventory data has exerted noticeable downward pressure on oil prices. According to the American Petroleum Institute, US crude inventories increased by approximately 6.6 million barrels for the week ending March 13, far exceeding the market expectation of a 600,000 barrel decline. This data significantly weakens the narrative of tight supply, indicating that there may not be a substantial short-term shortage in the market.

The unexpected inventory increase suggests two possibilities: first, demand underperformance; second, a temporary recovery in supply. Either scenario will constrain further price rises. Given that prices are already high, this “fundamental counter-signal” is particularly important.

From a global market perspective, rising oil prices have begun to push inflation expectations higher but may also suppress demand growth. For major importing regions like Asia, rising energy costs could increase economic pressures, potentially exerting a reverse effect on crude oil demand in the medium term.

Technically, WTI remains in an upward trend on the daily chart, but the slope of the rally has significantly slowed, with prices oscillating at high levels, indicating increased bullish-bearish divergence. Currently, around $90 serves as a key support level, while the $97–$100 range acts as an important resistance zone. From a momentum perspective, although the trend has not fully weakened, signs of high-level dulled momentum are emerging, characteristic of late-stage bullishness.

On the 4-hour chart, the price shows a “oscillating upward” pattern with decreasing momentum, with higher highs becoming smaller, and repeated resistance around $95, indicating increasing upward pressure. If the price breaks below $92 support in the short term, a technical correction could be triggered, further confirming the formation of a temporary top.

Overall, the market is gradually shifting from a “geopolitical-driven” to a “fundamentals and macroeconomic resonance-driven” phase. With risk premiums diminishing at the margin, the difficulty for oil prices to continue rising unilaterally has increased.

Editor’s Summary:
The crude oil market is entering a critical turning point. Although uncertainties in the Middle East remain, the market has largely digested most geopolitical risks, and sensitivity to sudden events has decreased significantly. Meanwhile, a substantial increase in US inventories signals a weakening of supply-demand margins, resonating with high prices and increasing the likelihood of a short-term top. Future price movements will depend more on actual supply disruptions and whether demand continues to weaken. In the absence of new bullish catalysts, WTI is more likely to enter a high-level oscillation or a phased correction zone, and investors should be cautious of increased volatility at high levels.

（Editor: Cao Yanyan HA008）

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