Crude oil futures remain elevated near the $70 per barrel area, attempting to consolidate most of Friday’s gains with traders maintaining their bullish outlook, fearing for further supply disruptions and the extension of the conflict.
Conflict between Israel and Iran aggravated during the weekend with the two sides exchanging missile blows across their opposing energy facilities, fueling fears for revamped hostilities and the extension of the conflict across the region.
The damage has been extensive with catastrophes ranging from residential, governmental and military facilities alongside refineries and oil depot sites in Iran. Damages in Israel were more limited due to the missile interceptions from the Iron Dome, yet some missiles pass through and partially damaged residential and governmental buildings.
So far Israeli authorities reported at least 14 deaths as a result of Iranian strikes, while Iranian authorities reported at least 224 deaths from Israeli strikes.
The prospect of a broader Middle East conflict threatens to disrupt the Strait of Hormuz, a key route where approximately 20-30% of global oil flows through and in the scenario where supply lines go offline, broader spikes in the commodity’s price are expected to take place.
Technical Analysis
WTI Chart – WTI futures temporarily pullback after Friday’s massive 13% intraday spike
Resistance: 73.00 (R1), 77.60 (R2), 80.70 (R3)
Support: 68.50 (S1), 64.50 (S2), 60.00 (S3)