WTI crude extended its selloff sharply today, breaking to the lowest level since early 2021 and deepening one of its worst annual performances in years. The US benchmark is now down roughly 22% for the year, marking its weakest showing since 2018. With downside momentum accelerating, WTI might be targeting 50 psychological level if selloff persists in the coming days.
A key catalyst behind this week’s intensified selling has been rising optimism around a peace agreement in Ukraine. Reports earlier in the week suggested US officials believe a deal to end the war is close, with roughly 90% of issues between Ukraine and Russia said to be resolved. That prospect has revived expectations of eventual normalization in energy flows.
However, significant hurdles remain. Any final agreement still hinges on territorial disputes between Kyiv and Moscow, as well as firm security guarantees. While President Volodymyr Zelenskyy has agreed to abandon Ukraine’s goal of joining NATO, he continues to push for Article Five–like security protections from the US and Europe, a demand that remains unresolved.
Beyond geopolitics, oil markets have been under sustained pressure from supply-side developments. OPEC+ members have ramped up production aggressively this year after years of coordinated output cuts, adding to concerns that global supply is now running ahead of demand at a time when growth momentum remains uneven.
Technically, the break of 55.20 low suggests that WTI’s long term down trend is resuming. Immediate focus is now on 61.8% projection of 66.70 to 56.44 from 60.50 at 54.15. Decisive break there would pave the way to 100% projection at 50.24. Outlook will stay bearish as long as 57.13 support turned resistance holds, in case of recovery.
