Crude Higher Despite Trump Comments
Deal or No Deal
Crude prices remain in the green today with the futures market holding near yesterday’s highs for now. The move higher comes amidst ongoing uncertainty over the US/Iran peace process. Yesterday, Trump noted that he had called off a planned military attack on Iran at the request of other states in the Gulf. This comes after he warned over the weekend that the ‘clock is ticking’ for Iran to make a deal or risk destruction. The US President went on to say (via the Truth Social) platform that he had been informed that Iran was open to making a deal which would include restrictions on nuclear weapons.
Uncertainty Persists
As ever with Trump it’s hard to know how much of this is aggressive dealmaking bravado and how much is real. Still, with oil prices higher, it suggests that traders sense little likelihood of a deal being agreed anytime soon and perhaps more wary that a return to war could be seen if a deal fails to materialise quickly.
Strait of Hormuz
With the Strait of Hormuz still effectively closed, global oil supply remains in a stranglehold, keeping energy prices skewed higher for now. However, there are clear incentives for both sides to make a deal with US consumers suffering greatly amidst higher fuel costs and Iran suffering the loss of oil revenues amidst the US blockade. For now, crude looks vulnerable to a continued drift higher. However, if we do get any breaking news regarding a possible deal, this could see crude prices reversing sharply lower.
Technical Views
Crude
The rally in crude has seen price pushing back above the 101.69 level, into the upper part of the contracting triangle pattern. While above here, focus is on a continuation higher towards the triangle highs and the 114.44 level next.
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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.