West Texas Intermediate (WTI), the US crude oil benchmark, fell to around $100.00 during early European trading hours on Wednesday following an unexpected build in US crude inventories, despite ongoing concerns about supply disruptions in the Middle East [1]. According to the American Petroleum Institute (API), US crude oil stockpiles for the week ending September 11 increased by 7.14 million barrels, a sharp contrast to the previous week's decline of 300,000 barrels and market expectations for a 1.8 million barrel drawdown [1].
The market is also reacting to news that Saudi Arabia suspended oil loadings at its Yanbu port after shutting its East-West pipeline due to an attack by Yemen's Iran-aligned Houthis on Friday. This pipeline typically reroutes about 4 million barrels per day, or roughly 4% of global supply, to the Red Sea port [1]. US Energy Secretary Chris Wright described the closure as a brief interruption expected to last days, while Andy Lipow, president of Lipow Oil Associates, suggested repairs could take months based on available images [1].
Analysts at Rabobank highlighted that this supply disruption is occurring against a backdrop of declining global crude inventories and increasingly strained Strategic Petroleum Reserves (SPRs), which they believe supports a structurally tighter oil market and reinforces their outlook for higher WTI prices in the coming years [1].
From a technical perspective, WTI remains above key support levels, trading at $100.05, with the 100-day simple moving average at $85.36 and the 20-day Bollinger middle band at $90.05. The Relative Strength Index (RSI) is near 69, indicating strong but stretched upside momentum. Immediate resistance is seen at the upper Bollinger band near $102.75, while support levels are at $90.05, $85.36, and $77.36 [1].
CONCLUSION
WTI crude prices declined sharply after a surprise build in US inventories, despite ongoing supply concerns from the Saudi pipeline closure. Analysts warn that tightening global inventories and strained reserves could support higher prices in the future. The market remains volatile, with technical indicators suggesting strong but stretched momentum.