WTI crude staged a recovery on June 25 after touching $68.90, the lowest level since February. The bounce was triggered by a bullish EIA weekly petroleum status report that showed crude inventories fell by 3.8 million barrels. Gasoline stocks also declined by 1.1 million barrels, while distillate stocks were flat.
The $68-70 zone has been a key support level for WTI, representing the bottom of the six-month range. The prompt month futures spread narrowed to -$0.15/bbl (contango), indicating that near-term supply is adequate but not excessive. A sharp backwardation would signal supply tightness.
Refinery utilization dipped 0.5 percentage points to 93.2%, still solid for June. Domestic crude production held steady at 13.2 million barrels per day. The inventory draw was attributed to an increase in exports rather than a drop in production, with crude exports rising by 420,000 bpd week-over-week.
The recovery was also supported by broader risk appetite as equity markets stabilized on June 25. WTI had lost 8.2% in the prior six sessions as concerns about Chinese demand and the US interest rate outlook weighed on the complex.
The $68-70 support held on the first test. Buyers should treat this level as a tactical entry for Q3 hedges. If WTI breaks below $68 on a weekly close, the next support is $65, then $62. For physical cargo buyers, bids below $70 are attracting interest from Asian refiners with higher margins.