Despite rising tensions in Kurdistan, both WTI and Brent continue to sell off following Monday's peak. Brent crude is currently trading just below $57, while WTI is changing hands above $51. While oil prices initially rallied on falling global stocks and US refinery demand, prices breached overbought conditions and have since weakened.
In political news, Turkey has threatened restrictions on oil trading with Iraqi Kurds following their independence referendum. Given a sizeable Kurd minority in Turkey, the country is highly sensitive to the threat of a Kurdish independence movement. While tensions continue to rise, the threat of political instability in the oil-rich region of Kurdish Iraq has had a limited impact on oil prices so far.
Looking at sentiment, this week's Asia Pacific Petroleum Conference in Singapore has been fairly upbeat. According to Reuters, this is a significant change from previous years, where industry participants were mostly downbeat on the prospects for oil prices.
Crude oil remains bullish in the medium term, having rallied from its most recent lows in the first week of June. The commodity has continued to soar for a variety of factors, including falling oil stocks, refinery demand following hurricane-related disruptions in the US, and hope for an extension of the OPEC supply cuts. Looking at various technical indicators on the weekly chart, crude oil is starting to look overbought, but remains within normal trading conditions.