WTI Firm as Geopolitics Improve, Supply Glut Persists

Key Moments

Price Action and Market Context

West Texas Intermediate (WTI) is trading around $60.60 in early European hours. The market is consolidating, and easing geopolitics is offsetting supply concerns.

$CL | ANALYSIS UPDATE🚨$WTI Just broke the MOST IMPORTANT resistance level so far ($60.40).

Looks like we're heading straight for that $60.80 level I told you, and in case we clear $61, I'll drop one of those full analysis updates you guys love😉

What's your bias right now?… pic.twitter.com/kjvv03d8OT

— Julian (@CrudeJulian) January 21, 2026

Geopolitics and Risk Sentiment

On Wednesday, US President Donald Trump said he would delay tariffs on Europe over Greenland after a framework deal was reached. Investors took this as a sign that trade tensions are easing. As a result, risk appetite improved, which gave WTI near-term support.

Supply Disruptions in Kazakhstan

Meanwhile, potential disruptions in Kazakhstan are supporting crude prices. Tengizchevroil, led by Chevron, paused production at the Tengiz and Korolev oilfields after fires hit power generators, according to Bloomberg.

Oversupply Concerns and Inventory Data

Still, oversupply worries continue to weigh on prices. The International Energy Agency (IEA) expects global supply to exceed demand this year. In addition, US crude inventories rose by about 3 million barrels last week. This reinforces concerns about a loose supply backdrop.

Market Positioning and Sentiment

“We saw some interest in buying Brent and WTI after Trump’s Davos speech,” said Chris Weston, head of research at Pepperstone Group. Still, he added that the supply outlook limits upside momentum and keeps traders cautious.

(This story was corrected on January 22 at 07:15 GMT to clarify that Trump said he would not impose tariffs on certain European countries after a Greenland deal, not the Greenback.)

WTI Oil – Key Concepts and Drivers

What is WTI Oil?

WTI is a type of crude oil traded globally. It stands for West Texas Intermediate and is one of the three major benchmarks, along with Brent and Dubai Crude. WTI is called “light” and “sweet” because it has low density and low sulfur content, making it easier to refine. It is produced in the US and delivered through the Cushing hub in Oklahoma. WTI is a key benchmark for oil markets and is widely referenced in financial media.

Core Price Drivers for WTI

Like other commodities, WTI is driven mainly by supply and demand. Strong global growth can lift demand, while weak growth can lower it. Political instability, conflict, and sanctions can disrupt supply and push prices higher. OPEC decisions also shape price trends. Finally, the US dollar affects oil, since oil is priced in dollars. A weaker dollar tends to support oil prices, while a stronger dollar can weigh on them.

Impact of Inventory Reports

Weekly inventory reports from the American Petroleum Institute (API) and the Energy Information Administration (EIA) often move WTI prices. These reports show changes in oil stockpiles, helping traders gauge supply and demand. If inventories fall, traders usually see stronger demand and higher prices. Conversely, rising inventories suggest ample supply and can weigh on prices. The API report comes out on Tuesday, followed by the EIA report on Wednesday. Typically, their results align closely, and traders view the EIA data as more authoritative.

OPEC’s Role in Shaping WTI Prices

OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 oil producers that set production quotas twice a year. These decisions can tighten or loosen supply and affect prices. When OPEC cuts output, prices often rise. When it increases output, prices may fall. OPEC+ includes additional non-OPEC producers, such as Russia, and has a similar influence on global supply.