WTI & Brent Crude, Oil and Forecasts Forecasts – Middle East Risk Drives Rallies Above 50-Day EMA

WTI Crude Oil Technical Analysis

The light sweet crude oil market has rallied a bit early on Tuesday, bouncing from the 50-day EMA as tensions in the Middle East seem to be going nowhere. With that being the case, there is going to continue to be a major problem with potential supply, and as long as that’s being threatened, it does make a lot of sense that oil will rally.

Previously, a few weeks ago, I suggested that maybe we were trying to find our summer range. That may have to be put on hold until we get some type of clarity coming out of Iran and Washington. As things stand right now, it looks like we are essentially stuck in a never-ending conflict. We wouldn’t even call it a war, but it does prompt the Iranians to try to shut down the Strait of Hormuz and possibly cause issues in the Red Sea as well. So, with all that being said, the threat of supply disruption is becoming a very real fear.

Brent Technical Analysis

The Brent market looks very much the same as we are now above the $91 level and cleared the 50-day EMA. The market rallying from here could open up the possibility of a move to the $100 level, an area that’s been important in the past.

But all things being equal, this is a market that is very bullish, and as long as we have the same problems going on in the overall conflict in the Middle East and concerns about energy disruption, Brent will more likely than not continue to have a bit of upward pressure attached to it. That being said, these headlines can be fickle, and an alternative move or somebody suddenly de-escalating the situation could send markets tumbling. That is the reality of the oil markets right now, is that they continue to be very headline-driven.

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