Tensions in the Middle East surrounding OPEC member Iran have supported the risk premium of oil prices, causing them to rise for two consecutive days.
Brent crude was slightly below $69 a barrel after rising more than 2% in the previous two trading days, while West Texas Intermediate was close to $64 a barrel. The United States said on Monday that vessels flying the US flag should stay as far away as possible from Iranian waters when passing through the Strait of Hormuz. The warning came despite signs of progress in nuclear talks between Washington and Tehran.
The Strait of Hormuz is a key trade route for energy transportation in the Middle East, connecting many energy-producing countries with global markets, especially the Asian market. Tehran has repeatedly threatened to close this vital maritime passage during periods of tension, but has never actually taken such action.
Since the beginning of this year, the price of crude oil has risen by more than 10%, as repeated geopolitical conflicts have overshadowed concerns that global oversupply of crude oil would lead to rising inventories and a fall in prices. This week, a series of data will be released, providing traders with new market insights. The first of these will be the latest figures from the US official forecasting agency, due later on Tuesday.
Analysts at RBC Capital Markets LLC, including Helima Croft, noted in a report: “Both Washington and Tehran seem to be taking a positive attitude towards the Oman talks, suggesting that further consultations may take place in the coming weeks.” They also added that during their recent visit to the Gulf region, “several well-informed regional observers indicated that concerns over rising oil prices might eventually prompt President Trump to seek a negotiated settlement of the dispute.”
Jeff Currie, a senior commodities analyst at Carlyle Group, said that there is a “severe underinvestment” in oil and metals, which have huge upside potential. He also added that the claim of an oversupply of crude oil has been exaggerated.
“If you have to go to great lengths to find evidence of an oil glut, it means there isn’t one,” Carlyle Group’s Energy Pathways Chief Strategy Officer Kury told Bloomberg Television.
Technical analysis:
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Gold: Yesterday, the plugin alerted that after the ascending triangle breakout, there was a pullback, reaching as low as 5086. Currently, the price has dropped back below 5000, and after the sweeping movement, it has once again converged. For today, we should pay attention to the direction of the new breakout after convergence, and closely monitor the breakout by the bulls. For detailed positions, please consult the plugin.
(Gold 15-minute chart)
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Nasdaq: Yesterday, the price precisely refreshed the liquidity at the bottom of our yellow zone and then rebounded rapidly, reaching a new high above 25,340. Currently, the price is consolidating in a narrow range for adjustment. Pay attention to the retest near 25,100 to confirm support and then continue to capture the rebound signal. For detailed positions, please consult the plugin.
(NASDAQ 15-minute chart)
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Crude oil: The price is attempting to stabilize and break through the bearish pressure. Within the day, it is crucial to closely monitor that the price does not fall back below 63.50. Secondly, it needs to break above 65. If the above conditions are met, we will consider buying after a pullback for confirmation. For detailed positions, please consult the plugin.
(Crude Oil 15-Minute Chart)
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Today’s key economic data and events to watch:
