Geopolitical War Premium
The potential for tanker seizures is currently outweighing the bearish 2026 surplus narrative. Traders are hedging against any disruption to the 20 million barrels per day that transit the Strait of Hormuz.
Inventory Tightness
A larger-than-expected drawdown in US commercial crude stocks reported this week has tightened the prompt physical market, providing a technical floor for WTI near the $65 level.