Crude oil futures closed the week lower, settling at $57.44, down $0.16 or 0.28% on the day. Over the course of the week, the commodity experienced significant selling pressure, falling 4.54% or $3.12 in total.
The highest price of the week was $60.30, reached on Monday, while the lowest point came on Thursday at $57.01.
This steep decline was driven by a combination of bearish supply data and a reduction in geopolitical risk premiums, which together outweighed smaller, localized supply disruptions.
A key factor was the growing consensus of a substantial supply surplus expected in 2026. The International Energy Agency (IEA) forecasted a record oil glut next year, largely due to increased output from non-OPEC countries such as the US and Canada, which is anticipated to exceed global demand.
Geopolitical tensions eased somewhat as peace talks regarding Ukraine gained momentum. Reports emerged that the White House would send a representative to Europe for negotiations, leading traders to reduce the “war premium” on oil prices and lowering concerns over sudden supply shocks from the region.
In addition, Iraq successfully restored production at a major oilfield accounting for roughly 0.5% of global supply, further easing market tightness.
There were some bullish developments—such as the US seizing a Venezuelan oil tanker and Ukraine attacking a vessel in Russia’s “shadow fleet”—but these incidents failed to significantly impact the broader market sentiment dominated by oversupply worries.
From a technical perspective, crude oil is currently testing a critical support zone between $57.10 and $57.39 on the hourly chart. This area represents a near-term “line in the sand” for the market’s direction.
If prices break and hold below this support zone, the bearish outlook will strengthen. Such a move could target the October low at $55.96 as the next major support level.
Conversely, if the price holds above this zone, buyers may re-enter the market, aiming for an immediate upside target of $58.13. However, any recovery faces resistance from the falling 100-hour moving average, currently at $58.28, which is rapidly approaching the $58.13 level and is likely to cap gains in the near term.
Original Source: Greg Michalowski of investinglive.com
