Crude demand is being impacted by a slowdown in global manufacturing, especially in China and the Eurozone. Q3 consumption estimates have been downgraded by the IEA because of tighter financial conditions and softening industrial activity. As production cuts are coordinated by OPEC+, the world’s oil supply is still comparatively limited. Despite OECD countries’ softer demand projections, these curbs—especially from Saudi Arabia and Russia—have helped limit price declines.

Uncertainty premiums are being fueled by heightened conflict risks in the Middle East and strategic tensions in the South China Sea. Even though supply chains have not yet been significantly impacted by recent escalations, any disruptions could cause crude to rise sharply. The US dollar has held steady against the majority of emerging market currencies, which has limited the upside potential of WTI crude priced in USD. It has strong support at $62.70 levels; a breakdown below that exposes $59, and if that doesn’t work, there is further downside bias.

The crude oil macro-outlook is still unclear. Aggressive bullish bets are capped by economic headwinds, while geopolitical risks offer upside support. Unless a supply shock occurs, crude oil futures are likely to stay in a wide range with dark undertones. Nonetheless, the INR has remained comparatively steady, bolstering the current domestic crude prices. In addition to diversifying its crude sourcing beyond reliance on the Middle East, India is still developing strategic petroleum reserves. Although domestic demand for refining is steady, fuel consumption may temporarily decline during the monsoon season.

Technically speaking, unless it is reversed with significant volume, the overall momentum favors bearish continuation. Following a robust upward trend from early June to mid-June, prices formed a rounded peak from mid-June to June 24. Additionally, there was sideways consolidation after the steep decline from ₹6,600 to ₹5,600, creating a bearish rectangle or flag. Right now, the price is consolidating at ₹5,690, just below the support-turned-resistance area.
The price may rebound to the ₹6,000–₹6,200 range if it breaks above ₹5,780.
However, if the support barrier breaks below ₹5,550, it may retest at ₹5,330, and then ₹5,000.

Tejas Shigrekar, Chief Technical Research Analyst- Commodities and Currencies at Angel One Ltd