Crude Rallies As US & Iran Resume Strikes
Fresh Attacks Spike Oil Prices
Crude oil prices are rising today amidst an uptick in hostilities between the US and Iran. The two countries exchanged attacks today, the first in weeks, as tensions mount once again over the Strait of Hormuz. The US carried out attacks on Iranian rocket launcher positions which it claimed were preparing to lay mines in the Strait. Iran meanwhile reported that a super tanker attempting to cross the Strait had been hit by mines. Iran also claimed attacks on a US military base in Jordan which also came under fire today. The hostilities have been met with disappointment by the global community after there had been hopes that the two sides were moving closer to resuming negotiations following the weeks that have passed since the 60-day peace window expired.
Near-Term Risks
Looking ahead, the focus now is on whether these attacks mark the start of a fresh campaign of tit-for-tat attacks or if tensions can subside. The US remains heavily opposed to Iran and Oman’s moves to control the Strait and charge taxes to passing vessels while Iran remains resolute over a refusal to abandon its nuclear energy program. While this remains the case, the prospect of a deal appears unlikely and crude prices should continue to push higher near-term.
Technical Views
Crude
The rally in crude has seen price breaking back above the 84.60 level. While above here, focus is on a continuation higher with 95.06 the next target for bulls. If we break lower again, 77.65 will be the key support level to watch along with a retest of the broken bear trend line from YTD highs.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.