Oil News: Crude Oil Futures Eye Breakout—Iran and Venezuela Shift Oil Outlook

Fibonacci Support Holds as Bulls Target 50-Day Moving Average

Light crude oil futures are edging higher on Tuesday after an impressive rebound rally the previous session. On Monday, the market fell sharply into 61.8% Fibonacci support at $56.31, but reversed to close higher for the session. That rally and today’s follow-through move has put the market in a position to challenge the 50-day moving average at $58.83 and the swing top at $58.88.

Taking out $58.88 with conviction will put the market on the strong side of two trend indicators. If this move creates enough upside momentum then look for the rally to extend into an intermediate 50% level at $60.30 and another swing top at $60.36.

On the downside, support is the new swing bottom at $56.31.

At 11:49 GMT, Light Crude Oil Futures are trading $58.58, up $0.26 or +0.45%.

Maduro Capture Sparks Delayed Safe-Haven Bid in Energy Markets

Oil prices are firming today as traders continue to assess the events from over the weekend that saw the U.S. use military force to capture Venezuelan President Nicolás Maduro. With plenty of global supply, traders aren’t worried about a shortage yet, however, there are still concerns surrounding Venezuelan output.

Traditionally, any worries over a supply disruption produce spikes to the upside. What we could be seeing today is a delayed reaction to the news. And the position of the market, just under the 50-day moving average, could lead to an upside breakout. Nonetheless, traders don’t expect any price surge to last.

Analysts Expect Ample 2026 Supply Despite Geopolitical Uncertainty

“It is premature to evaluate the impact of Nicolás Maduro’s capture on the oil balance. What seems obvious, nonetheless, is that oil supply will be sufficient in 2026, with or without an increase in production from the OPEC member,” said PVM Oil analyst Tamas Varga.

Uncertainty goes both ways, so it could just be the lack of sellers allowing buyers to push the market higher and probe for buy stops above the 50-day moving average. Additionally, short-term volatility can be expected because of the surprise event. However, over the long run, prices are expected to remain under pressure in 2026 due to growing supply and weak demand.

Venezuela Production Recovery: A Multi-Decade Investment Challenge

Supply from Venezuela is expected to grow over the long term, but it’s going to take money to get the country’s industry up to speed. Growth of 300,000 barrels per day in three years is possible on limited incremental spending, but it’s going to take a major injection of international capital to drive it to 3 million barrels per day by 2040, says an analyst at Rystad.

Iran Tensions Add Second Geopolitical Risk Premium to Oil Markets

Unrest in Iran and a threat by President Trump to intervene could be additional factors underpinning crude oil prices. An overthrow of the current government or a military-led intervention in Iran could bring enough turmoil to the oil market to produce an immediate $10 to $20 jump in prices.

The Verdict: Volume and Order Flow Will Reveal Breakout Conviction

Traders should keep an eye on volume and order flow on a test of the 50-day moving average to determine if there is strong enough buying to fuel a successful upside breakout of this major trend indicator.

More Information in our Economic Calendar.