Insights 
VT 
Key Points:
- U.S. crude (WTI) drops 2.13% to $61.06, marking a steep pullback from a recent high of $63.88.
- Speculation around a renewed U.S.-Iran nuclear agreement triggers concerns over increased global oil supply.
Oil prices sank sharply on Thursday, with U.S. crude (WTI) closing 2.13% lower at $61.06 per barrel, pressured by market chatter around a possible nuclear deal between Washington and Tehran. Traders reacted to growing expectations that such an agreement could eventually lift sanctions on Iranian oil exports, increasing global supply.
The sell-off in crude comes after a multi-day rally powered by a 90-day tariff truce between the U.S. and China. While that announcement initially stoked hopes of a demand rebound, the mood across global markets has since soured. IG’s Tony Sycamore likened the reversal to a hangover following a “huge party,” with investors now showing caution as macro risks reassert themselves.
Adding to oil’s headwinds are comments from President Donald Trump regarding a debt-laden federal budget and concerns about the sustainability of U.S. growth. The 10-year U.S. Treasury yield hit a one-month high, amplifying investor concerns about borrowing costs and debt levels.
Market sentiment was further dampened by declines in major equity indices across Asia and Europe. Japan’s Nikkei dropped 0.85%, while China’s CSI300 shed 0.63%. U.S. futures also pointed lower, with the broader mood turning defensive ahead of retail sales data and earnings from Walmart—both seen as gauges of consumer health.
Technical Analysis
Oil prices have extended their downward correction, with CL-OIL-ECN dropping sharply from $63.88 to a session low of $60.95, marking a two-day slide of over 4.5%. The chart shows a sustained break below the 5-, 10-, and 30-period moving averages, reinforcing a bearish short-term trend. The selling pressure intensified as price breached prior support near $62.00, with weak buying interest evident on the recovery attempts.
Picture: Oil tumbles to $60.95 as bearish momentum deepens, with short-term pressure persisting below $62 resistance, as seen on the VT Markets app
The MACD remains in negative territory, though histogram bars are flattening out slightly, suggesting the pace of decline may be slowing. However, with no clear bullish crossover yet and price action still hugging lower lows, further downside risk remains unless buyers reclaim the $61.50–$62.00 range. For now, the path of least resistance points lower.
Cautious Forecast
Oil is likely to remain volatile as traders weigh geopolitical headlines and central bank commentary. A confirmed U.S.-Iran breakthrough would likely pressure prices further toward the $60 support zone. However, if talks stall or risk sentiment rebounds on dovish Fed commentary, a bounce toward $62.50–$63.00 remains plausible. The near-term outlook hinges heavily on today’s retail sales print and Powell’s tone in his scheduled remarks.
