WTI Crude Oil Price Forecast: USOIL Brace for U.S. Election Impact Amid Narrow Trading Range

Oil markets entered a narrow trading range on Tuesday as investors awaited the outcome of a highly anticipated U.S. presidential election, following a 2% surge in prices earlier this week.

This rise came after OPEC+—the alliance of the Organization of the Petroleum Exporting Countries and its allies—opted to delay its planned December production hike. The decision reflects an uncertain demand outlook amid growing non-OPEC supply and ongoing pandemic-related challenges.

Analyst Tony Sycamore from IG described the current market atmosphere as “the calm before the storm,” hinting that volatility could surge as election results unfold.

The close contest between Democratic candidate Kamala Harris and Republican Donald Trump adds to market tension, with potential delays or disputes in election outcomes posing additional risks for broader markets.

OPEC+ Holds Off on Output Hike as Global Demand Remains Fragile

On Sunday, OPEC+ announced a one-month delay to its planned production increase, a move aimed at stabilizing the market amidst weak demand signals and increasing non-OPEC oil supply. October saw a slight increase in OPEC production, primarily due to Libya’s resumed output, as noted in a recent Reuters survey. However, Iraq’s compliance with OPEC+ production cuts helped temper the overall output rise.

Meanwhile, Iran has signaled intentions to boost production by an additional 250,000 barrels per day, which could add pressure to prices if implemented. In the U.S., a developing tropical storm in the Gulf of Mexico is expected to intensify, potentially curbing oil output by up to 4 million barrels—a temporary factor that could add short-term support to prices.

Key points to watch this week include China’s National People’s Congress meeting, where market participants hope for potential fiscal stimulus announcements to boost demand. However, analysts expect China to wait for U.S. election results before committing to any significant economic policy shifts.

#COMMODITY MARKET #UPDATE –#Crudeoil surged following OPEC+'s decision to postpone planned output increases by a month.#Naturalgas jumped with another hurricane expected to enter the Gulf of Mexico.#Commodityupdates #Commoditynews #MCX

— Kedia Advisory (@kediaadvisory) November 5, 2024

Technical Analysis: WTI Crude Oil Holds in Tight Range

WTI crude oil is trading around $71.44, constrained within a narrow channel between $71.25 and resistance at $71.79 on the 2-hour chart. This channel reflects market indecision, with a breakout above or below these levels likely to determine the next directional move.

Should WTI break above $71.79, prices could test the next resistance levels at $72.30 and potentially $72.80. Conversely, a dip below $71.25 would expose support at $70.10, with stronger support seen around $69.50.

Technical indicators suggest a mild bullish bias. The 50-day Exponential Moving Average (EMA) at $70.29 provides solid support near current prices, and the Relative Strength Index (RSI) is near 60, indicating moderate buying pressure without signaling overbought conditions. However, fundamentals—particularly U.S. election results and potential Federal Reserve policy shifts—remain pivotal for the market’s next significant move.

Key Insights:

• Resistance Levels: $71.79, $72.30, $72.80
• Support Levels: $71.25, $70.10, $69.50
• Technical Indicators: RSI at 60 suggests moderate buying strength; 50 EMA at $70.29 supports a bullish trend