The spot WTI crude oil price, traded on the Chicago Mercantile Exchange, surged to an intraday high of U.S. $47.10 per barrel on Thursday before tumbling 5.01% to settle at U.S. $44.74 per barrel, after Russia resumed its second day of airstrikes in Syria and Iran is preparing for a ground offensive. Traders were concerned about the escalation of the conflict, as the U.S. government claimed that Russian airstrikes targeted CIA-backed rebels. 

According to The Huffington Post, there is a U.S. rebel-training operation run by the CIA in southern Syria, which trained about 10,000 rebel fighters on a budget approaching $1 billion a year. In June, the House Intelligence Committee voted unanimously to cut the CIA Syria budget, by as much as 20%, after facing skepticism of its effectiveness.

The U.S. Energy Information Administration (EIA) said on Wednesday that the U.S. commercial crude-oil inventories rose to 457.9 million barrels, up 4 million barrels in the week ended September 25. Analysts surveyed by The Wall Street Journal had expected an inventory build of 1 million barrels. Excluding the Strategic Petroleum Reserve of about 695.1 million barrels, U.S. crude oil inventories remain near levels not seen for this time of year in at least the last 80 years. The U.S. consumes an average of 19.11 million barrels per day (bpd) and produces about 9.14 million bpd.

Bloomberg reported that Saudi Arabia’s commercial petroleum stockpiles increased to 320 million barrels, the highest since at least 2002, from 319.5 million barrels in June, according to data on the Riyadh-based Joint Organisations Data Initiative's website on Sunday. Saudi Arabia told OPEC that its June production of 10.564 million bpd was a record, exceeding a previous all-time high set in 1980.

The P5+1 countries, which include the U.S., Russia, U.K., France, China and Germany, reached a nuclear deal with Iran on July 14. In early August, Iranian Oil Minister Bijan Namdar Zanganeh said that Iran can increase its production by 500,000 bpd within a week after sanctions end, and by 1 million bpd within a month following that. As reported by MarketWatch, Iran has at least 34 supertankers full of oil, which is about 50 million barrels or more, ready to be delivered as soon as sanctions are lifted.

The September 17 deadline for Congress to accept or reject the Iran nuclear deal agreement has passed, while the U.S. Senate refused to debate or vote on the agreement. The deal proposed by the Obama administration is already backed by at least 41 senators, while only 34 votes in the Senate are required to ensure lawmakers cannot kill the deal. 

The House just voted on Thursday on a bill to block implementation of the Iran nuclear deal until Tehran pays more than $43 billion in damages that U.S. courts have awarded to victims of Iranian-sponsored terror. The Wall Street Journal reported that with the agreement now backed by a United Nations resolution and with efforts to defeat the accord in the U.S. Congress having failed, the parties in the Iran nuclear deal aim for implementation in early 2016.

As of September 22, there are 489,204 long positions of non-commercial contracts of light sweet crude oil futures, traded on the New York Mercantile Exchange by hedge funds and dealers, an increase of 3,385 long positions from last week, according to the Commitment of Traders (COT) data released by the Commodity Futures Trading Commission (CFTC) each Friday. 

This is compared to about 229,775 short positions, a decrease of 16,658 short positions from last week where light sweet crude oil contracts are traded in units of 1,000 barrels. Hedge funds and dealers have increased the net long positions by about 20,043 contracts, in anticipation of a breakout in the crude oil prices.

Technically, the crude oil price has been moving in a descending wedge chart pattern since June. In late August, Venezuela asked OPEC for an emergency meeting, which sent the crude oil price soaring and broke out the descending wedge. Since then, the crude oil price has been moving in a symmetrical triangle chart pattern as traders can’t decide in which direction the crude oil price will be moving next. 

From the chart pattern, it looks more likely that the crude oil price will eventually break down and head to retest the U.S. $40 per barrel level, sooner rather than later, as global crude oil supply continues to build.