Insights 
VT 
West Texas Intermediate (WTI) is trading at approximately $72.15 during Asian trading hours as of Monday. This increase follows Israel’s attack on Iran’s natural gas facilities, raising concerns about potential supply disruptions in the region.
Iran is contemplating closing the Strait of Hormuz, a crucial channel for transporting about one-fifth of the world’s oil. A closure could drive oil prices up as supply routes are affected.
Impact Of Potential US Tariffs
US President Donald Trump’s potential tariffs on trading partners could impact WTI prices. This uncertainty poses a risk of undermining oil prices amid geopolitical tensions.
Chinese Retail Sales and Industrial Production data for May are due later. Weaker-than-expected results could lower oil demand, affecting WTI prices since China is a major oil consumer.
WTI oil, or West Texas Intermediate, is a high-quality crude oil sold globally. It is “light” and “sweet” due to low gravity and sulfur content and serves as a benchmark for oil prices.
Supply and demand dictate WTI oil prices, influenced by global growth, political factors, and OPEC’s decisions. Inventory data from APIs and EIA affects prices, with EIA considered more reliable. OPEC influences prices by adjusting production quotas during biannual meetings.
Geopolitical And Economic Tensions
The increase in West Texas Intermediate (WTI) pricing to just over $72 reflects a sharp response to heightened concerns over regional oil flows, primarily due to recent military action in the Middle East. Israeli strikes targeting Iranian gas infrastructure have revived fears about supply security. The suggestion by Tehran of potentially shutting the Strait of Hormuz—one of the most vital maritime links for global oil—sends a clear message that the threat to supply isn’t abstract. That strait sees around 20% of oil trade pass through it, thus any real disruption would not be shrugged off by markets for long.
In addition to geopolitical risk, Washington’s broader trade stance is raising additional pricing questions. With Trump weighing the reintroduction of tariffs, we’re looking at a scenario where demand may come under strain. Such policies have, historically, dampened cross-border trade and manufacturing activity. If those sectors slow, so too does the appetite for energy—especially oil, which is tightly tied to global industrial health.
Meanwhile, traders are watching China with considerable interest. Retail sales and factory output data for May are expected soon and those numbers will speak volumes about domestic demand in the world’s biggest oil importer. Weaker results wouldn’t just suggest a soft domestic economy—they’d put downward pressure on oil, reinforcing worries about over-supply. Whether this comes as a slight drift lower or a sharper correction will largely depend on how short the data falls from expectations.
On the technical side, WTI’s quality continues to support its position as a pricing benchmark. Its light and sweet characteristics mean it needs less processing and often trades at a premium. However, long-term pricing is less about the oil itself and more about who’s moving and buying how much, and when. Production quotas set by OPEC still function as a price lever. Adjustments to those limits either tighten or ease supply, though market reactions can vary depending on inventory levels and how quickly those changes are implemented.
As traders, when we consider positioning over the next several sessions, the key edge comes from anticipating reaction rather than chasing headlines. We must examine whether current levels already account for the geopolitical flareups or if there’s scope for sustained follow-through. Inventory data—particularly via the EIA—offers a more grounded, numerical view of whether supply lines are actually tightening or if sentiment is running ahead of fundamentals. Basing exposure on well-timed reactions to such releases can offer clarity amid the noise.
Finally, macroeconomic indicators should not be viewed in isolation. A soft print from Asia would not merely hit demand projections—it might also push broader assets into risk-off posture, strengthening the dollar. That, too, can pressure oil prices, since a stronger greenback often makes dollar-priced commodities less attractive to foreign buyers. Therefore, we must weigh all these elements, often simultaneously, when acting on price moves. This calls for strategy over impulse, and readiness to adjust when clear confirmation is absent.
