WTI crude oil extended its decline to around $82.80 during Thursday’s early Asian trading session. Despite escalating tensions in the Middle East, which have heightened concerns over potential supply disruptions and could provide support for oil prices, bearish pressure remains in place. Meanwhile, data from the U.S. Energy Information Administration (EIA) showed that U.S. crude stockpiles dropped by 7.167 million barrels last week, signaling tighter supply conditions.
WTI Falls Below $83.00 as Profit-Taking Offsets Middle East Supply Risks
West Texas Intermediate (WTI) crude oil traded near $82.80 during Thursday’s Asian session, extending losses as traders locked in profits following the Federal Reserve’s latest policy decision. The Fed left interest rates unchanged at 3.5%–3.75%, in line with expectations, while Chair Kevin Warsh reiterated the central bank’s commitment to returning inflation to its 2% target without signaling the future path of monetary policy.
Despite the decline, escalating geopolitical tensions in the Middle East continue to provide underlying support for oil prices. President Donald Trump warned that the United States would retaliate against Iran after a recent attack on a U.S. military installation in Jordan. Overnight, Iranian forces reportedly launched ballistic missiles at a U.S. airbase and command center in Jordan, though all were intercepted. At the same time, U.S. and Saudi forces resumed strikes against Iran-backed militias in Iraq after a brief pause in hostilities.
Additional concerns stem from the Red Sea region, where Yemen’s Iran-aligned Houthi movement is reportedly considering charging commercial vessels passing through the strategically important Bab el-Mandeb Strait, a key route connecting the Red Sea and Gulf of Aden. Such measures could further disrupt global energy shipments and tighten supply conditions.
Supporting the broader oil market, U.S. crude inventories posted a much larger-than-expected drawdown. Data from the Energy Information Administration (EIA) showed stockpiles fell by 7.167 million barrels in the week ending July 24, reversing the previous week’s 2.011 million-barrel increase and significantly exceeding forecasts for a 2.5 million-barrel decline.
Meanwhile, Brent crude also came under pressure after the United States extended its pause on direct strikes against Iran. According to Rabobank strategist Benjamin Picton, Brent futures dropped nearly 5% as President Trump emphasized a preference for diplomacy, describing the current pause as an opportunity for “very deep talks” with Tehran, while warning that negotiations would need to progress quickly.
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