Oil Price Outlook: IEA Downgrades and China Imports

• Brent Oil prices remain rangebound amid trade tensions and fluctuating demand forecasts.
• IEA lowers oil demand growth projections, while China's imports show an increase.
• Technical analysis indicates key support levels at 63.00, 61.00, and 60.00, with resistance at 66.42, 68.17, and 69.35.

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Brent crude prices continue to consolidate and remain largely rangebound. The market is dealing with the U.S. President Donald Trump's suggestions of new tariff exemptions, as well as China's oil imports which increased, but this was balanced out by the IEA lowering its oil demand forecast, similar to OPEC.

The shifting U.S. trade policies have caused uncertainty in global oil markets. On Monday, OPEC lowered its demand forecast for the first time since December. Similarly, on Tuesday, the IEA reduced its oil demand growth projections to 730,000 barrels per day (bpd) for this year, down from 1.03 million bpd, and to 690,000 bpd for next year, citing growing trade tensions.

The IEA stated that the worsening global economic outlook, driven by a sudden rise in trade tensions in early April, has led to a cut in their oil demand growth forecast for this year.

Key points from IEA

• Global oil supply rose in March by 910k b/d YoY to 103.61
• Non-OPEC+ accounted for 890k b/d of March supply increase.
• Global 2026 oil supply to add 950k b/d, exceeding demand.
• Non-OPEC+ to add 1.3m b/d in 2025 to 54.4m, led by US
• Non-OPEC+ supply seen robust in 2026 adding 920k b/d.
• OPEC March crude output fell 150k b/d to 41.6m b/d.

Despite the OPEC + and IEA downgrades, oil prices are finding support after data from China yesterday, which showed that China’s crude oil imports for March were up around 5% YoY. Chinese crude oil imports topped 12 million barrels per day (bpd) in March, the highest volume since August 2023. The jump was also said to be down to an Iranian oil surge as the US looks to tighten sanctions on the Middle Eastern country.

The US and Iran are currently having nuclear talks after stern warnings from president Trump that the lack of a deal could lead to military action. The risks from a potential US-Iran confrontation could lead to a significant jump in oil prices but it does seem like President Trump is eyeing a deal rather than military confrontation at this point.

U.S. Energy Secretary Chris Wright said on Friday that the U.S. might block Iranian oil exports to put pressure on Tehran over its nuclear program. However, based on Chinese data this week, there is skepticism over whether such an approach would work.

Oil inventory data will be released with the API releasing today and the EIA tomorrow. Will the API follow last month's trend and show a significant drop in inventory numbers?

Even if it does though, I see only a small jump in oil prices with sustainability of a move higher likely to come into question.

This is a follow-up analysis of my prior report “Will Brent Oil recover? Trade tensions and inventory data to watch” published on April 8 2025.

From a technical analysis standpoint, Brent has remained in a tight range since the massive hammer candlestick printed on Wednesday April 9.

Since then Crude prices have moved sideways as resistance at 66.44 remains strong.

The period-14 RSI on a daily timeframe remains just above oversold territory which could be seen as a sign that significant bearish momentum is still in play.

Brent Crude Oil Daily Chart, April 15, 2025

Dropping down to an H4 chart, and this is where it gets interesting. On the H4 the RSI crossed above the neutral 50 handle on the period-14 RSI.

A retest of the neutral 50 level and bounce could be a sign that momentum remains strong for further upside.

Immediate resistance may be found at 66.42 before the 68.17 and 69.35 handles come into focus.

Support may be found at 63.00 before the 61.00 and psychological 60.00 handle come into focus.

Brent Crude Oil Four-Hour Chart, April 15, 2025

Support

• 63.00
• 61.00
• 60.00 (psychological level)

Resistance

• 66.42
• 68.17
• 69.35

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