WTI oil price on Feb 20, 2026?
Short Answer
The model sees potential mispricing: WTI oil prices settling between $66.00 and $66.99 on Feb 20, 2026 are forecast at 31.3% by the model versus 42.5% by the market, suggesting the market may be overconfident in this most likely outcome.
1. Executive Verdict
- Escalating U.S.-Iran geopolitical tensions are driving WTI prices higher.
- Unexpected 9.0 million barrel U.S. crude inventory drawdown tightened supply.
- WTI options market shows a positive skew due to U.S.-Iran tensions.
- China's crude inventories reflect strategic stockpiling, not weak demand.
- Strait of Hormuz maintains stable oil flow despite geopolitical volatility.
Who Wins and Why
| Outcome | Market | Model | Why |
|---|---|---|---|
| $66.00 to 66.99 | 47.0% | 28.0% | Market participants currently project prices will settle within this specific range. |
| $65.00 to 65.99 | 22.0% | 17.0% | Strong market sentiment anticipates WTI oil prices will fall within this band. |
| $64.00 to 64.99 | 8.0% | 7.5% | Current market analysis suggests prices have a moderate likelihood of reaching this level. |
| $71.0 or above | 5.0% | 4.5% | The market view indicates a lower probability for prices exceeding this threshold. |
| $62.00 to 62.99 | 2.0% | 2.0% | Limited market conviction suggests prices are unlikely to settle in this specific interval. |
Current Context
WTI crude oil prices surged to six-month highs on February 20, 2026, largely driven by escalating geopolitical tensions, significant inventory drawdowns, and OPEC+ production policies. Futures traded between $66.62-$66.78 per barrel [^], [^], [^], [^] as heightened tensions between the United States and Iran became a primary catalyst for the recent rally [^], [^], [^], [^], [^]. Reports indicate a 10-15 day deadline for Iran to finalize a nuclear agreement, coupled with a US military buildup in the Middle East, sparking fears of supply disruptions through the critical Strait of Hormuz [^], [^], [^]. Further tightening the market, the U.S. Energy Information Administration (EIA) reported an unexpectedly large drawdown of 9.01 million barrels in commercial crude oil inventories for the week ending February 13, 2026 [^], [^]. This drawdown, contrary to analyst expectations, signaled robust demand and tighter supply conditions, with gasoline and distillate stockpiles also declining more than anticipated. Meanwhile, OPEC+ members continue to influence sentiment by reaffirming their decision from November 2025 to pause production increases for the first quarter of 2026, citing seasonal demand patterns [^], [^].
Market participants closely monitor key data and upcoming events for future price direction. Traders and analysts are particularly focused on the immediate WTI spot price, which stood at $66.62-$66.78 per barrel on February 20, 2026 [^], [^], [^], as well as the EIA Weekly Petroleum Status Report, with the latest release on February 19, 2026, covering the week ending February 13, 2026 [^]. Expert opinions on 2026 average WTI prices vary, with the EIA’s February Short-Term Energy Outlook (STEO) projecting $53.42 per barrel for the year and $49.34 by March 2026, though this predates the recent geopolitical surge [^]. Other forecasts include Standard Chartered at $59.90, BMI at $64.00, and J.P. Morgan's Natasha Kaneva at $54 per barrel for 2026. Andrew Lipow suggests the market rally will persist in anticipation of US-Iran developments, while Trading Economics estimates WTI at $63.74 by Q1 2026 and $69.97 in 12 months [^]. Upcoming critical events include the reported US-Iran nuclear agreement deadline in late February or early March 2026 [^], the next EIA Weekly Petroleum Status Report on February 25, 2026, and the next full OPEC+ ministerial meeting on June 7, 2026 [^].
Key concerns for the WTI market revolve around geopolitical risk and overall sustainability. The primary concern remains the duration and severity of the US-Iran tensions and their potential to disrupt oil supplies, especially through the Strait of Hormuz. Investors are debating whether the current price rally is sustainable or a "bull trap," particularly in light of earlier forecasts predicting an oil surplus in 2026 [^], [^]. The market is also weighing the unexpected US inventory drawdowns against broader expectations of potential global oil inventory builds later in 2026 due to increased production from non-OPEC+ countries. Rising oil prices are fueling concerns about their inflationary impact globally, and questions persist regarding OPEC+'s effectiveness in managing internal politics and defending prices amidst evolving supply and demand dynamics.
2. Market Behavior & Price Dynamics
Historical Price (Probability)
Outcome probability
Date
The prediction market for the WTI oil price on Feb 20, 2026, has demonstrated a strong and decisive upward trend, rising from an initial probability of 6.0% to a recent price of 48.0%. The price action was not gradual; instead, it was characterized by sharp, significant spikes in the final days before resolution. A major move occurred on February 18, when the price jumped 16.0 percentage points from a near-zero base to 17.0%. This was immediately followed by another large 17.0 percentage point spike on February 19, pushing the probability from 17.0% to 34.0% before it continued its climb to the current 48.0%.
These rapid price increases were directly driven by fundamental developments in the global oil market. The initial spike on February 18 was a reaction to escalating geopolitical tensions between the United States and Iran, which caused a rally in actual WTI crude prices. The subsequent spike on February 19 was a continuation of this momentum, as real-world WTI prices surged further due to significant inventory drawdowns and ongoing supply concerns related to OPEC+ policies. This confluence of factors pushed the actual oil price into the $66.62-$66.78 range, making the outcome of this prediction market (which resolves based on a $65.50 strike price) significantly more likely and forcing traders to rapidly re-evaluate their positions.
The trading volume, which totaled 16,169 contracts, appears to have concentrated around these major price moves, indicating that the spikes were supported by high conviction among market participants. The price levels of 17.0% and 34.0% acted as temporary plateaus or consolidation points following the news-driven events. Overall, the chart reflects a dramatic shift in market sentiment. What was initially perceived as a low-probability event became a near 50/50 proposition in a matter of days, as traders aggressively priced in new information that pointed toward a higher settlement price for WTI crude oil.
3. Significant Price Movements
Notable price changes detected in the chart, along with research into what caused each movement.
Outcome: $64.00 to 64.99
📉 February 19, 2026: 19.0pp drop
Price decreased from 26.0% to 7.0%
What happened: The 19.0 percentage point drop in the prediction market price for "WTI oil price on Feb 20, 2026: $64.00 to 64.99" was primarily driven by a significant increase in actual WTI crude oil prices on February 19, 2026, which pushed the price range higher than the predicted outcome [^]. WTI crude oil prices surged to six-month highs, settling between $66.43 and $66.75 per barrel, due to escalating geopolitical tensions between the United States and Iran, and a larger-than-expected drawdown in US crude stockpiles [^]. President Donald Trump's statements, such as warning Iran with a 10-day deadline on its nuclear program and the deployment of US military assets in the Middle East, contributed to the heightened geopolitical risk premium in oil prices and were widely reported by traditional news outlets [^]. While no specific social media activity directly causing a drop in oil prices for the specific outcome was found, the amplification of these geopolitical tensions, potentially via social media, acted as a contributing accelerant to the overall bullish movement in oil prices, thus reducing the probability of the market settling in the $64.00-$64.99 range [^].
Outcome: $65.00 to 65.99
📈 February 18, 2026: 20.0pp spike
Price increased from 2.0% to 22.0%
What happened: The 20.0 percentage point spike in the "WTI oil price on Feb 20, 2026?" prediction market on February 18, 2026, was primarily driven by escalating geopolitical tensions between the United States and Iran [^]. WTI crude oil prices rallied significantly, settling near $65 a barrel, as news reports indicated a lack of diplomatic breakthrough in U.S.-Iran nuclear talks and the U.S [^]. reaffirmed military options were on the table [^]. Specifically, an Axios report suggesting any U.S [^]. military operation against Iran could be a prolonged campaign, rather than a quick strike, increased market concerns over potential crude supply disruptions, especially through the Strait of Hormuz [^]. Social media activity from influential figures was not identified as a primary driver; instead, traditional news from major outlets reporting on diplomatic failures and military posturing directly coincided with the price movement [^]. Therefore, social media was mostly irrelevant as a primary driver for this specific price spike [^].
4. Market Data
Contract Snapshot
The contract concerns the WTI oil price on a Friday, with the year 2026 also mentioned. However, the provided text does not specify the exact conditions that would trigger a 'YES' or 'NO' resolution for the market, as it only poses a question. No other key dates, deadlines, or special settlement conditions are detailed.
Available Contracts
Market options and current pricing
| Outcome bucket | Yes (price) | No (price) | Implied probability |
|---|---|---|---|
| $66.00 to 66.99 | $0.47 | $0.62 | 47% |
| $67.00 to 67.99 | $0.39 | $0.85 | 39% |
| $65.00 to 65.99 | $0.22 | $0.82 | 22% |
| $61.00 to 61.99 | $0.16 | $0.99 | 16% |
| $70.00 to 70.99 | $0.11 | $0.96 | 11% |
| $68.00 to 68.99 | $0.10 | $0.93 | 10% |
| $64.00 to 64.99 | $0.08 | $0.93 | 8% |
| $69.00 to 69.99 | $0.06 | $0.96 | 6% |
| $71.0 or above | $0.05 | $0.96 | 5% |
| $62.00 to 62.99 | $0.02 | $0.99 | 2% |
| $63.00 to 63.99 | $0.02 | $0.99 | 2% |
| $58.00 to 58.99 | $0.01 | $1.00 | 1% |
| $59.00 to 59.99 | $0.01 | $1.00 | 1% |
| $60.00 to 60.99 | $0.01 | $1.00 | 1% |
| $57.99 or below | $0.01 | $1.00 | 1% |
Market Discussion
On February 20, 2026, discussions and debates surrounding WTI oil prices were predominantly driven by escalating geopolitical tensions between the United States and Iran, which propelled prices to a six-month high of around $66.62-$66.78 per barrel [^]. Experts and news commentary focused on the "war premium" being priced in due to fears of supply disruptions in the Middle East, particularly concerning the Strait of Hormuz, following a reported US ultimatum to Iran regarding its nuclear program and a significant US military buildup in the region [^]. This bullish sentiment was further supported by a larger-than-expected draw in US crude inventories, though some earlier forecasts of lower prices for 2026 were being revised amid the heightened risk environment [^].
5. How Are WTI Options Skewed by U.S.-Iran Geopolitical Tensions?
| ATM Implied Volatility | 51% (February 20, 2026 ) |
|---|---|
| 25-Delta OTM Call IV | 55% (February 20, 2026) |
| 25-Delta Risk Reversal (Skew) | +7 percentage points (February 20, 2026) |
The West Texas Intermediate (WTI) crude oil options market currently shows a significant positive skew. As of February 20, 2026, this indicates a much higher probability of sharp upward price movements, largely driven by ongoing U.S.-Iran geopolitical tensions. Quantitatively, the 25-delta risk reversal, which measures this skew, stands at +7 percentage points, reflecting the market's strong bias towards upside risk. This current sentiment mirrors earlier observed spikes in both Brent and WTI call skews in early January 2026, during which implied volatility increased by 15-25% amidst periods of heightened uncertainty.
The market actively prices significant upside risk from escalating conflict. The elevated implied volatility of out-of-the-money call options essentially functions as the market's "war insurance," as traders anticipate potential major supply disruptions. Scenarios involving limited military engagement could swiftly elevate oil prices to the $80 per barrel range, while direct attacks on critical energy infrastructure might push prices towards $100 per barrel. A disruption of the Strait of Hormuz, a crucial chokepoint for approximately 20% of global daily oil supply, represents an ultimate tail-risk scenario, with potential for prices to exceed $100 per barrel. The geopolitical risk premium was estimated at $4 per barrel in January 2026, though historical events like the Russia-Ukraine war show precedents for premiums surging as high as $31-$47 per barrel.
Diplomatic breakthroughs would rapidly unwind premiums, triggering price corrections. Conversely, a credible diplomatic resolution between the U.S. and Iran would likely lead to a rapid unwinding of this geopolitical risk premium, potentially triggering price corrections of 15-25% within days or an immediate decline of $5 to $8 per barrel. Such a resolution would also cause a collapse in implied volatility, redirecting the market's attention to underlying supply and demand fundamentals, which currently suggest a structural oversupply in 2026. The market's heightened sensitivity to breaking news is further amplified by algorithmic and high-frequency trading, projected to account for 35% of front-month WTI volume by 2026, contributing to rapid position adjustments and exacerbated price swings.
6. What Drove U.S. Crude Oil Inventory Drawdown in February 2026?
| Commercial Crude Oil Inventory Drawdown | 9.0 million barrels |
|---|---|
| Refinery Utilization Rate | 91.0% |
| Net Crude Oil Imports | 1.9 million barrels per day |
U.S. crude oil inventories saw a significant, supply-driven drawdown. Commercial crude oil inventories for the week ending February 13, 2026, decreased by 9.0 million barrels, bringing total inventories to 419.8 million barrels. This substantial reduction was primarily driven by a significant contraction in net crude oil imports, which averaged 1.9 million barrels per day, combined with robust refinery activity, including net crude oil inputs averaging 16.1 million barrels per day and utilization rates reaching 91.0%. The overall inventory decrease was overwhelmingly due to supply-side factors, despite strong demand signals.
The drawdown was predominantly caused by a sharp decline in net imports. Approximately 93.6% of the weekly inventory change was attributable to a dramatic decrease in net crude oil imports. This decline resulted from a reduction in gross imports to 6.5 million b/d and a concurrent surge in gross exports to 4.6 million b/d. In contrast, increased refinery processing contributed a smaller, positive 0.54 million barrels to the weekly drawdown, indicating sustainable demand strength within the refining sector.
WTI oil prices face nuanced implications from this inventory report. While the large headline drawdown will likely prompt an initial bullish market reaction, a deeper analysis suggests questioning the sustainability of this draw. The significant impact from net imports is potentially a temporary disruption, such as weather or scheduling issues, rather than an emerging structural shift in the market. Although robust refinery demand provides a strong price floor, the transient nature of the supply side component indicates that an initial price spike might be followed by consolidation, rather than a sustained step-change in price.
7. How Do Strait of Hormuz Oil Transit Patterns Affect WTI Prices?
| Weekly Transit Volume | 135 crude tankers per week [^] |
|---|---|
| Total Oil Flow | 20 million bpd [^] |
| US/UK Flagged Transit Speed | Up to 17 knots (vs. 13-14 knots standard) [^] |
Strait of Hormuz maintains stable crude oil flow despite geopolitical volatility. Over the past seven days, the daily average volume of crude oil tanker transits through the Strait of Hormuz was approximately 19-20 vessels, totaling 135 transits per week. This volume is consistent with the 30-day moving average, as corroborated by various tracking services [^]. The chokepoint consistently facilitates the transit of about 20 million barrels per day (bpd) of total oil, accounting for 20% of global petroleum liquids consumption, a figure supported by U.S. EIA data [^]. Even temporary disruptions, such as Iranian naval exercises on February 17, 2026, caused only minor delays, with traffic quickly normalizing and no sustained reduction in volume [^].
US- and UK-flagged vessels altered transit patterns due to perceived risk. While physical transit volumes remain stable, geopolitical tensions have introduced a significant risk premium into oil prices. US- and UK-flagged vessels have notably adjusted their transit behaviors, increasing speeds up to 17 knots compared to a typical 13-14 knots, and adhering to advisories to remain in international waters, clear of Iranian territorial seas [^]. This behavioral change directly responds to heightened perceived risk, exemplified by incidents like the aggressive approach of the US-flagged oil tanker Stena Imperative by Iranian Revolutionary Guard Corps gunboats in February 2026. These operational modifications, though costly for ship operators, indicate a market under duress, where the "how" of transit is as crucial as the "what" in risk assessment.
WTI crude oil prices reflect stable flows and a geopolitical risk premium. For WTI crude oil, the market presents a bifurcated reality: consistent physical flows cap potential price surges from supply fears, while persistent geopolitical friction and risk mitigation tactics establish a strong support floor. The market currently demonstrates a tense equilibrium, having priced in the present level of tension, suggesting WTI will likely remain range-bound but elevated, retaining recent gains that constitute the risk premium [^]. Future movements in WTI will depend on high-frequency indicators, including shifts in transit speed distribution, war risk insurance premiums, and any changes in vessel destination masking or bunker fuel price differentials, as these signal evolving perceptions of risk [^].
8. Are China's Crude Oil Inventories Driving Global Market Dynamics?
| Onshore Inventories (End 2025) | Approximately 1.13 billion barrels [^] |
|---|---|
| New Storage Capacity (2026) | 271 million barrels [^] |
| Current Stockpiling Rate | ~300,000 barrels per day (bpd) [^] |
China's crude inventories reflect strategic stockpiling, not weak demand. China's current crude oil inventory dynamics indicate a strategic, policy-driven stockpiling effort rather than a conventional demand pullback, fundamentally reshaping its role in the global oil market. Onshore crude stocks reached approximately 1.13 billion barrels by late 2025. However, satellite analysis shows overall storage utilization remains below historical averages (less than 65%), revealing a massive expansion in capacity [^]. This confirms that the inventory build is an active process of filling newly constructed tanks, not a result of weak refinery demand. The motivation is further codified by a January 2025 law prioritizing energy security and mandating 'social responsibility' reserves [^].
Floating storage declines as China expands capacity significantly. Floating storage, particularly in Asian waters, holds significant volumes of sanctioned crude from Russia, Iran, and Venezuela in shadow fleet tankers, which reached multi-year highs offshore China and Singapore in January 2026 [^]. While global floating storage stands at about 99 million barrels, these levels in Asia (approximately 51 million barrels) are declining as China absorbs cargoes [^]. China is aggressively expanding its storage infrastructure, with an estimated 271 million barrels of new commercial capacity becoming operational in 2026, elevating total capacity to over 2.39 billion barrels [^]. This provides ample room for continued inventory builds, with recent data suggesting a stockpiling rate of 300,000 barrels per day, and forecasts projecting up to 1.0 million barrels per day for 2026 and 2027 [^].
China's strategic demand offers strong, price-inelastic crude market support. This strategic imperative creates a substantial, price-inelastic demand sink, providing strong support for crude prices. The ongoing inventory build is a fundamentally bullish phenomenon, acting as a durable floor for crude oil prices by absorbing global supplies. This means China's oil appetite is driven by both commercial and significant strategic demand, the latter of which is less sensitive to short-term price fluctuations. Consequently, a significant price decline appears unlikely as long as this policy remains in effect, with China's stockpiling potentially accelerating price rallies rather than capping them [^].
9. How Do Gamma Pinning and Open Interest Influence CLJ6 WTI Futures?
| Aggregate WTI Futures & Options OI | 2.68 million contracts [^] |
|---|---|
| Non-Commercial Net Short Position | ~203,000 contracts [^] |
| Current WTI Crude Oil Price | Approximately $65 per barrel [^] |
Gamma pinning heavily influences WTI CLJ6 futures around key strikes. The WTI futures market, particularly for the CLJ6 contract, is significantly affected by gamma pinning effects, a phenomenon where collective delta-hedging by market makers creates a gravitational pull on the underlying price. This effect is most pronounced within the $65-$70 strike price range, especially as the February 20, 2026 expiration date approaches [^]. These dynamics are underpinned by a substantial aggregate open interest in WTI futures and options, totaling 2.68 million contracts, which makes the market susceptible to price containment around key option strikes [^].
Significant speculative short positioning creates a potential 'coiled spring' scenario. This market dynamic is further complicated by substantial speculative positioning, as Non-Commercials hold a net short position of approximately 203,000 contracts in combined WTI futures and options, a level reported to be near multi-year highs [^]. This creates a "coiled spring" effect where the stabilizing force of the gamma pin could either maintain the price within the $65-$70 corridor, or, if breached, potentially trigger a rapid short squeeze. Such a squeeze would compel both speculators and market makers to buy futures to cover their positions [^]. While a price pinning effect remains a high probability, the extreme short interest introduces a moderate risk for an explosive upward price movement.
10. What Could Change the Odds
Key Catalysts
The WTI oil market is currently experiencing significant upward pressure from two key immediate catalysts. Escalating geopolitical tensions between the United States and Iran, marked by U.S. President Trump's ultimatum regarding Iran's nuclear program, have intensified fears of military conflict and potential disruptions to the critical Strait of Hormuz, a chokepoint for 20% of global oil supply, leading WTI prices to a 6.5-month high [^]. Adding to this bullish sentiment, the U.S. Energy Information Administration (EIA) reported an unexpected and substantial drawdown of 9.0 million barrels in commercial crude oil inventories for the week ending February 13, 2026, on February 19, signaling tighter supply conditions contrary to market expectations [^].
Further supporting price increases are strong U.S. petroleum product demand, which rose 4.1% over the past four weeks compared to the previous year, alongside high refinery utilization rates. OPEC+ members have reaffirmed their commitment to current production quotas, and Russian crude supply has reportedly declined. While bearish factors such as increased Venezuelan crude exports and a growing volume of crude in floating storage exist, their immediate impact appears to be mitigated by the more pressing geopolitical risks and the recent inventory data. Longer-term U.S. production forecasts and global inventory builds are less likely to significantly influence today's market settlement [^].
Key Dates & Catalysts
- Strike Date: February 20, 2026
- Expiration: February 28, 2026
- Closes: February 20, 2026
11. Decision-Flipping Events
- Trigger: The WTI oil market is currently experiencing significant upward pressure from two key immediate catalysts.
- Trigger: Escalating geopolitical tensions between the United States and Iran, marked by U.S.
- Trigger: President Trump's ultimatum regarding Iran's nuclear program, have intensified fears of military conflict and potential disruptions to the critical Strait of Hormuz, a chokepoint for 20% of global oil supply, leading WTI prices to a 6.5-month high [^] .
- Trigger: Adding to this bullish sentiment, the U.S.
13. Historical Resolutions
Historical Resolutions: 50 markets in this series
Outcomes: 3 resolved YES, 47 resolved NO
Recent resolutions:
- KXWTIW-26FEB13-T67.99: NO (Feb 13, 2026)
- KXWTIW-26FEB13-T51: NO (Feb 13, 2026)
- KXWTIW-26FEB13-B67.5: NO (Feb 13, 2026)
- KXWTIW-26FEB13-B66.5: NO (Feb 13, 2026)
- KXWTIW-26FEB13-B65.5: NO (Feb 13, 2026)
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