West Texas Intermediate (WTI), the US crude oil benchmark, declined to around $89.00 during early Asian trading hours on Wednesday, following remarks by US President Donald Trump regarding recent diplomatic engagement with Iran. Trump stated that the United States held a three-hour meeting with Iran's delegation on the sidelines of the United Nations General Assembly in New York City, describing the meeting as 'very good.' He also indicated he faces a 'big decision' on whether to pursue a negotiated deal with Iran or maintain pressure, warning of potential severe consequences if no agreement is reached, but also suggesting a deal could be imminent amid ongoing diplomatic efforts [1].
The oil market is also reacting to geopolitical tensions after the Houthis targeted the Saudi capital Riyadh and the key oil export port city Yanbu over the weekend. The Saudi military reported intercepting a ballistic missile aimed at Riyadh and thwarting the attack on Yanbu, with no fresh damage to oil infrastructure or disruption to production reported so far [1]. Analysts at OCBC noted that crude prices may find renewed support due to these fresh attacks, as the Houthis claimed missile and drone strikes on Riyadh and an Aramco facility at Yanbu, but Saudi authorities confirmed that the attacks were thwarted [1].
On the supply side, US crude oil inventories saw an unexpected weekly build. According to the American Petroleum Institute (API), crude oil stockpiles in the US for the week ending September 18 increased by 1.786 million barrels, compared to a rise of 7.14 million barrels in the previous week. This contrasted with market expectations of a 500,000 barrel decline [1].
From a technical perspective, WTI retains a constructive bias above the 100-day simple moving average (SMA), with the near-term trend still bullish despite the recent pullback from cycle highs. Immediate resistance is noted at the Bollinger middle band at $92.10, with further resistance at the upper Bollinger Band near $102.40. On the downside, support is seen around $89.10, followed by the 100-day SMA at $85.00 and the lower Bollinger Band at $81.75, where deeper corrections could attract fresh buying interest [1].
CONCLUSION
WTI crude oil prices have pulled back to near $89.00 amid renewed geopolitical risks and unexpected US inventory builds. While technicals suggest a still constructive trend, market sentiment remains cautious as traders weigh the outcomes of US-Iran diplomacy and potential supply disruptions from Middle East tensions.