Oil rises as Middle East tensions persist
#oil prices are rising, with Brent moving above $110 per barrel and WTI approaching $100, as geopolitical tensions in the Middle East continue to drive supply concerns.
Markets are awaiting clarity on US–
#iran negotiations, particularly around the Strait of Hormuz, which remains closed. The US is reviewing Tehran’s latest proposal to resolve the conflict, but Donald Trump has so far rejected it, citing concerns that it does not sufficiently address Iran’s nuclear programme.
This leaves the two-month-long conflict at a stalemate. The longer the Strait remains closed, the greater the upside risk to oil prices. However, a sudden de-escalation, government intervention, or demand destruction could trigger a pullback.
Warnings of demand destruction are already emerging. The supply shock—disrupting up to 13 million barrels per day is beginning to weigh on consumption, particularly in Asia. The International Energy Agency has warned that high prices could force reduced demand, either through affordability constraints or policy intervention.
Oil forecast technical analysis
Oil recovered from the 78.00 April low, rising above the 50 SMA and the 20 SMA around 98.00, which, combined with the RSI above 50, keeps buyers hopeful of further upside.
Buyers would need to extend gains towards 100.00, the psychological level, and look towards 105.00, the 23.6% Fib retracement of the 55 low and 120 high.
Support can be seen at 95.00, the 38.2% Fib retracement level to bring 88.00 into focus, the 50 SMA, and the 50% Fib retracement level. Below here, sellers could gain traction towards 80.00, the round number.
Chair Jerome Powell is likely to emphasise a “wait-and-see” approach, balancing rising inflation driven by higher energy prices against risks to growth and employment. The conflict is pushing up fuel costs—adding to inflation—while also increasing uncertainty businesses,
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