• WTI has round-tripped the entire war premium and now sits just above its February base.
• OPEC+ lifted quotas again for August while actual Gulf output is still catching up.
• The Brent curve's slip into contango frames Wednesday's EIA inventory data as the week's main test.

West Texas Intermediate (WTI) has spent three weeks handing back what the war spent three months building, and the tape now reads as though February never ended. The US benchmark drifts near $68.50 while Brent hovers close to $72.00, both a couple of dollars above their pre-war bases and nearly 40% below the March extremes.

The candles have been shrinking for a week and the ranges with them, which tells you the momentum did not fade so much as leave with the risk premium. The June 17 interim agreement between Washington and Tehran reopened the Strait of Hormuz to normal traffic, the fear trade was carried out of the building, and what remains is a market forced to price ordinary supply and demand for the first time this year. It does not appear thrilled by the exercise.

The differential says the war trade is closed

Brent's premium over WTI has settled near $3.50, which is plain freight-and-quality territory rather than anything resembling a risk premium. Seaborne barrels carried the fear through the war, and that gap has now compressed back to the boring arithmetic of pipelines versus tankers. Nobody is paying extra for Brent's postcode anymore, and the differential is the cleanest single gauge that the geopolitical bid has been fully extracted.

Everyone is selling into the reunion

The Organization of the Petroleum Exporting Countries (OPEC) and its allies, collectively OPEC+, agreed on Sunday to add another 188K barrels per day (bpd) to August quotas, the latest step in restoring 940K bpd of paper supply since the war began. Actual output still lags the paperwork, with the biggest Gulf producers having lost around 6 million bpd at the worst of the closure, though flows have been recovering since the June agreement. The United Arab Emirates has meanwhile walked away from the quota system altogether, Washington is still working through a 172 million barrel release from the Strategic Petroleum Reserve (SPR) agreed during the war, and US production set a record near 14 million bpd in May.

The curve said the quiet part

The Brent futures curve tipped into contango last week for the first time this year, with the six-month spread near minus 56 cents; when the market pays you to store barrels, it is telling you it has too many of them. OPEC's own monthly report has trimmed 2026 demand growth in back-to-back months, to under 1 million bpd, so the supply wave is arriving into a shrinking demand forecast. Strategists have begun sketching Brent into the 60s by year-end, and for once the futures market is not arguing with them.

Wednesday brings the receipts

Weekly inventory data from the Energy Information Administration (EIA) lands Wednesday at 14:30 GMT, the first clean read on stockpiles since Hormuz traffic began normalizing, after industry figures Tuesday evening. Minutes from the June Federal Open Market Committee (FOMC) meeting arrive the same day at 18:00 GMT; a hawkish Federal Reserve (Fed) keeps the Dollar bid, and Dollar-priced barrels do not enjoy that. OPEC+ ministers reconvene on August 2, where a compensation-hungry Iraq is already agitating for a bigger quota.

Levels to watch

Resistance: WTI's first hurdle is the $70.00 handle, with the June breakdown shelf near $72.00 behind it; Brent faces the same test at $74.00. Reclaiming those levels on a daily close is the minimum before anyone argues the flush is finished.

Support: Initial demand sits close to $67.50 for WTI and around $71.00 for Brent, the floors of the past week's drift. Below there, $65.00 is the only round figure of note before the February bases near $62.00 for WTI and $66.50 for Brent, where this entire journey started.

Bias: Bearish. The Stochastic Relative Strength Index (Stoch RSI) has been pinned near its floor for two weeks while price keeps leaking, and oversold in a downtrend is a description, not a buy signal. With quotas rising, the reserve draining, and the curve paying for storage, rallies toward $70.00 are for selling; only a daily close back above $72.00 changes the conversation, while a break of $67.50 puts the February base on the table.

WTI daily chart

Brent daily chart