WTI crude oil price volatility and geopolitical tensions

WTI crude oil futures initially settled at $85.01, following a 2.35% decline driven by profit-taking and rising U.S. inventories. While the U.S. announced additional sanctions against Iran to achieve economic isolation, the absence of immediate secondary sanctions on trading partners helped mitigate fears regarding the sudden loss of Iranian crude from the market. Demand concerns also weighed on prices, as both the IEA and OPEC lowered their 2026 forecasts.

Subsequently, WTI crude oil prices experienced a surge, climbing above the $90.00 mark. Technical analysis indicated a bullish trend, with market participants monitoring the $95.00 to $100.00 range as a critical decision zone for future price movement. Analysts identified support levels at $87.50 and $87.80, noting that while a minor pullback occurred from a high of $92.62, prices remained above key moving averages. Long-term technical projections suggested potential targets between $108.00 and $135.00, though a correction toward $71.00 remained a possibility if resistance was rejected.

Prices rose for three consecutive days, trading near $92.30 following U.S. strikes on Iranian tankers near Kharg Island. U.S. officials stated the strikes responded to an attempted missile attack on a U.S. warship. In retaliation, Iran launched ballistic missiles toward Jordan and warned vessels near Kuwaiti and Bahraini ports to ‘immediately abandon their vessels.’ Furthermore, Iran-backed Houthi militants targeted energy infrastructure in southern Saudi Arabia, including the Jazan refinery. Geopolitical instability in the Strait of Hormuz and rising demand from China are further driving prices upward as refiners seek alternative supplies.