WTI retreats as OPEC+ supply rise outweighs EIA inventory draw

• WTI retreats despite EIA inventory miss.
• OPEC+ supply increases outweigh short-term US stockpile reduction, pushing WTI toward moving average support.
• Momentum indicators suggest that short-term price action may remain favourable for bears below $65.00.

WTI Crude Oil is trading under pressure despite a larger-than-expected draw in US Crude inventories on Wednesday, as rising supply and demand concerns continue to limit the upside move. At the time of writing, WTI is trading at $65.14.

While the Energy Information Administration (EIA) data was fundamentally supportive, the muted-to-negative price reaction indicates that sentiment is cautious, and traders may be focusing more on macroeconomic headwinds or technical resistance.

The EIA released its latest weekly inventory report on Wednesday, which reflected a larger-than-expected reduction in stockpiles. Following an unexpected 7.07 million build last week, analysts had expected the data to show a 1.8 million barrel reduction this week. However, actual figures reflected that stockpiles fell by 3.859 million barrels, surpassing expectations.

However, the API and the OPEC+ reports released on Tuesday reflected that supply remains firm, restricting upside potential for WTI.

A decisive break below $64.18 could invite further selling, while holding above it might keep bulls in play.

WTI was unable to sustain gains above the 50.0% Fibonacci retracement level of the January-April decline at $67.08 on Monday and has since retreated to around $65.25.

This pullback highlights weakening bullish momentum, further evidenced by repeated rejection near $67.00 and a breakdown below the ascending trendline.

Price is now hovering near the 38.2% Fibonacci retracement at $64.18, a critical technical area also supported by the convergence of the 50-day Simple Moving Average (SMA)at $64.87 and the 100-day SMA at $64.78, all of which are providing support. The Relative Strength Index (RSI) reads at 47, indicating neutral momentum with a slight bearish tilt.

While the EIA data suggests tightening supply, the technical picture urges caution, with the $64.75-$65.00 zone likely to play a key role in shaping near-term direction.