WTI rebounds as Gaza peace and US-China trade hopes lift sentiment
- WTI rebounds above $59 as traders buy the dip after last week’s sell-off to a five-month low.
- Market sentiment improves on hopes of a US-China trade de-escalation following last week’s tariff rhetoric.
- OPEC’s October report signals steady demand and rising output, pointing to a balanced market outlook.
West Texas Intermediate (WTI) Crude Oil stabilizes on Monday after a bruising week that saw prices tumble to their lowest level since May, briefly touching $57.89 per barrel. At the time of writing, the US benchmark trades near $59.60, up nearly 3.0% on the day, as short-covering and hopes of a potential de-escalation in US-China trade tensions offered modest relief to energy markets.
The rebound comes after a sharp sell-off driven by oversupply concerns and the fading geopolitical risk premium. On Monday, US President Donald Trump declared the Gaza war “over” during a speech to the Israeli Knesset, confirming that all remaining hostages have been released and that a new phase of the US-brokered Gaza peace plan will begin this week. The announcement follows reports of a full ceasefire and prisoner exchanges between Israel and Hamas, with an international summit planned in Egypt to finalize security guarantees.
Market sentiment also drew support from signs that Washington and Beijing may resume trade discussions after last week’s escalation in tariff rhetoric. US Treasury Secretary Scott Bessent confirmed that President Trump and Xi Jinping still plan to meet this month at the APEC forum, citing “substantial communication” over the weekend. Meanwhile, Beijing pushed back against Washington’s threat of 100% tariffs by defending its rare-earth export curbs as a national security measure, even as it called for dialogue and urged the US to “correct” its policies.
Meanwhile, the Organization of the Petroleum Exporting Countries (OPEC) released its October Monthly Oil Market Report earlier on Monday, keeping its 2025 global Oil demand growth forecast unchanged at 1.3 million barrels per day. The group reported that OPEC+ crude production rose by 630,000 barrels per day in September to an average of 43.05 million bpd, while the Organisation for Economic Co-operation and Development (OECD) inventories remained about 92 million barrels below their five-year average. The report underscored a broadly balanced outlook for 2026, suggesting that rising supply from OPEC+ and non-OPEC producers may offset steady demand growth in the months ahead.
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.