United States Oil Is Tumbling: What's Happening?

United States Oil Fund (NYSE:USO) shares are dipping on Thursday. Crude prices seem to be retreating from recent highs. Here’s what you should know. United States Oil Fund shares are experiencing downward pressure. What’s pulling USO shares down? Diplomatic Push To Protect Energy Infrastructure President Donald Trump warned Iran on Wednesday that further strikes on Qatar's LNG facilities would trigger a strong response, stressing that Israel would not target Iran's South Pars gas field again. French President Emmanuel Macron echoed that sentiment, calling for an immediate halt to attacks on energy and water infrastructure after speaking with Trump and Qatar's emir. Macron urged a rapid moratorium on strikes targeting civilian energy systems, underscoring the global urgency to prevent further damage to oil and gas supply. U.S. Signals Flexibility On Iranian Oil Treasury Secretary Scott Bessent told Fox News the U.S. may allow Iranian oil already at sea to move into the market and is considering unilateral reserve releases to help stabilize global supply. He also noted that tankers are now leaving the Strait of Hormuz with U.S. awareness. If Iranian barrels begin flowing again and U.S. reserves are tapped, the additional supply could ease the tightness that pushed crude sharply higher. Strait Of Hormuz Traffic Shows Early Signs Of Improvement Bessent's comments imply that some commercial shipping is cautiously resuming through the Strait of Hormuz, which handles roughly 20% of global oil flows. Even a modest improvement in transit conditions reduces the risk of a prolonged supply squeeze. Iran is also considering imposing transit tolls on ships rather than blocking the strait outright, a move that, while costly, would be far less disruptive than a full shutdown. The Technical Side USO is trading 20.9% above its 20-day simple moving average (SMA) and 52.8% above its 100-day SMA, keeping the longer-term uptrend intact even with today's dip. Shares are up 62.81% over the past 12 months and are positioned closer to their 52-week highs than lows. The RSI is at 79.76, which is overbought and often signals the move may be due for a cooldown rather than a clean continuation. Meanwhile, MACD is still bullish (11.0370 vs. an 8.6988 signal line), showing the uptrend hasn't fully broken even if momentum is getting stretched. The combination of overbought RSI (above 70) and bullish MACD suggests mixed momentum. Key Resistance: $124.00 Key Support: $97.50 USO Price Action: United States Oil shares were down 2.45% at $118.69 at the time of publication on Thursday. The stock is approaching its 52-week high of $124.07, according to Benzinga Pro. Image: QQMinh88/Shutterstock