Oil Traders Re-Build LongsThe latest CFTC COT institutional positioning report shows that crude traders increased their net long positions last week from around 210k contracts to roughly 214k contracts. While not a huge increase, the adjustment does at least put an end to the weeks of reductions we’ve seen in upside bets. This change has been well reflected in price action this week with crude oil failing to continue the recent downward trend and instead reversing higher.Mixed Backdrop For OilThe backdrop for oil remains tricky with the market still caught between opposing forces. On the one hand, the ongoing supply disruption caused by the Russia-Ukraine war, in terms of oil output but also global distribution, is keeping prices supported. With gas prices soaring back to highs over the last week, oil has seen fresh demand as consumers and businesses turn towards oil usage to avoid the price peaks in gas. Additionally, the uptick in global travel, along with the summer driving season in the US, has also had a bullish impact on crude prices, lifting the demand outlook.Recession Fears Still Weigh However, there are still mounting concerns over a potential global recession over the remainder of the year. China has been scrambling to add stimulus over the last two-weeks as data releases there continue to highlight economic weakness. Furthermore, news of fresh lockdowns in China this week are also hurting sentiment. Oil prices suffered sharply during the Shanghai lockdowns earlier in the year and, with fears of further, major lockdowns later in the year, oil traders are wary of the impact on demand.OPEC Production Cut ChatterThe latest headlines around OPEC have helped lift oil prices this week. Comments made by the Saudi Arabian energy minister earlier in the week suggested that OPEC might look to ease off on production once again in a bid to help lift ailing oil prices. While the comments have not yet been confirmed by OPEC, given Saudi’s role as the group’s de-facto leader, traders have been happy to buy oil on the back of the comments.EIA Reports Further DrawdownThere was further good news for crude bulls from the EIA this week. The group reported a larger-than-expected drawdown of 3.3 million barrels last week. This was beyond the 2.5 million barrel drawdown forecast. Despite the better news on headline inventories, gasoline stocks were virtually unchanged, suggested slowing demand from the US driving season as summer winds down.Technical ViewsCrude OilThe reversal higher off the 85.53 level in crude has seen the market breaking out above the bear channel from YTD highs. Price is now testing the 95.93 level, which holds a strong of broken former lows. This is a key level for the market and a break higher here will open the way for a much fuller recovery. Failure here, however, keeps the focus on further downside near-term with 85.53 vulnerable.