WTI hovers near five-month lows with bearish momentum intact

• WTI Crude remains under pressure, extending last week's losses amid a stronger US Dollar and demand concerns.
• Renewed US-China trade tensions and weaker Chinese refinery runs weigh on sentiment.
• From a technical perspective, WTI remains below key moving averages with momentum indicators signaling persistent bearish bias.

West Texas Intermediate (WTI) Crude Oil continues to lose ground on Monday, pressured by a firmer US Dollar (USD) and persistent concerns over weakening global demand. At the time of writing, WTI is changing hands near $56.63 per barrel, down over 1.0% on the day, hovering near its lowest level since early May.

The Greenback's rebound is weighing on commodity prices, as a stronger USD makes Oil more expensive for holders of other currencies. Meanwhile, traders remain cautious following recent data showing China's crude storage flows slumped in September, a sign of slowing import appetite from the world's largest Oil consumer.

Adding to the bearish tone, the International Energy Agency (IEA) last week warned of a "large surplus" building through 2026, citing resilient non-OPEC supply growth and soft demand from advanced economies. These factors, combined with renewed US-China trade tensions, have curbed risk sentiment and fueled concerns about a deeper downturn in energy markets.

Beyond the immediate market pressures, longer-term demand concerns linked to the global energy transition, particularly in China and the European Union, are also weighing on sentiment toward Oil. Both regions are accelerating investment in renewable energy, electric vehicles and stricter carbon policies, which could gradually reduce reliance on conventional fuel sources.

On the technical front, WTI is trading well below its short-term and long-term moving averages on the daily chart, reinforcing the broader bearish structure.

Immediate support lies in the $54.00-$55.00 zone, marking the May 5 low, which is also closely aligned with this year's low from April 9 around $54.78. A decisive break below this region could intensify selling pressure and expose WTI to fresh multi-year lows, potentially extending the decline toward the $53.00 handle.

On the upside, the $60.00 handle remains a crucial pivot. Unless WTI reclaims this level decisively, the outlook will stay tilted to the downside. The Relative Strength Index (RSI) is hovering near 30.5, suggesting that prices are entering oversold territory, though no clear reversal signal has emerged yet. Meanwhile, the Average Directional Index (ADX) at 28.6 indicates strengthening trend momentum, confirming that sellers remain in control.