In the week ending 22 Jul, the crude oil futures benchmarks (Brent and WTI futures) saw uninspiring price movements, with the M1 Brent futures oscillating between a narrow range of $67 and $70, noting strict support and resistance, respectively, on either end. Meanwhile, the M1 WTI futures contract briefly climbed from $66/bbl to $67.60/bbl but retreated to $65.50/bbl on 22 Jul. Open interest (OI) also paints a mixed picture in both contracts, with OI holding steady at 2,851mb in Brent futures (+0.30% w/w) and declining by 2.7% w/w to 2mb in WTI futures. Total managed-by-money long positioning fell by 2.8mb (-0.54%) in the crude futures contracts in the week ending 22 Jul, while total short positioning rose by 2.3mb (+1.3%) in the same week. This bearishness was predominantly led by Brent futures, while WTI futures recorded a more risk-on week by speculative players.
The oil market remains tentative, with players scrambling for direction amid the US’ tariff threat on the EU and the EU’s 18th sanctions package against Russia, which also targets petroleum exports made from Russian crude. This update to the EU’s sanctions on Russia followed US President Donald Trump’s warning that countries purchasing Russian exports could face sanctions if Moscow fails to reach a peace agreement with Ukraine within 50 days, adding to the uncertainty.
