WTI Crude Oil Holds Above $66 Amid Middle East Tensions and Strong U.S. Demand

WTI Crude Oil Holds Above $66 Amid Middle East Tensions and Strong U.S. Demand

West Texas Intermediate (WTI) crude oil price is floating near $66.15 early Friday during the Asian session, as geopolitical tensions in the Middle East and falling U.S. inventories support bullish sentiment.

Drone Strike in Iraq Raises Supply Concerns

According to a report from Reuters, a drone strike targeted a Norwegian-operated oil and gas facility in Kurdistan, specifically in the Tawke, Zakho district of northern Iraq. As a result, operations have been temporarily suspended, reigniting fears of supply disruptions from the region.

Although the U.S. has not issued a retaliatory response at the time of writing, any potential escalation could lead to concerns over tighter global oil supply, likely driving further upside in crude prices.

US Crude Stocks Drop Sharply

On the domestic front, the U.S. Energy Information Administration (EIA) revealed that crude oil inventories dropped by 3.859 million barrels for the week ending July 11, compared to a build of 7.07 million barrels the week prior. Analysts had expected a drawdown of only 1.8 million barrels, indicating stronger-than-expected summer fuel demand.

This data underscores the seasonal uptick in consumption, offering further price support.

Tariff Concerns Could Limit Gains

While the oil market appears to be bolstered by rising geopolitical and seasonal demand pressures, ongoing tariff uncertainties could limit upside momentum. Investors are watching closely for any developments on trade policy that may affect broader economic conditions and energy demand.

Outlook for WTI Crude

With the WTI crude oil price holding above $66, traders should remain cautious of any further news out of the Middle East. A flare-up in tensions could quickly turn into a major catalyst for oil markets. At the same time, inventory trends and macroeconomic signals such as tariff negotiations will also play a role in shaping short-term price direction.

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