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*Crude oil prices spike on renewed geopolitical tensions in the Middle East.
*U.S. intelligence suggests Israel may prepare to strike Iranian nuclear facilities.
*Middle East instability poses risks to global oil supply, supporting prices.
Crude oil prices surged sharply amid escalating tensions between Israel and Iran, renewing fears of potential supply disruptions. According to U.S. intelligence, Israel is reportedly preparing for a potential strike on Iranian nuclear facilities—an action that would not only heighten regional instability but also threaten global oil flows. The Middle East currently supplies about a third of the world’s oil, making it a highly sensitive region for energy markets.
Oil has already been volatile in recent sessions due to conflicting headlines surrounding the Iran-US nuclear negotiations. These talks could potentially allow more Iranian barrels to re-enter the market later this year, at a time when supply is projected to outpace demand. However, a military escalation by Israel would likely derail diplomatic progress and exacerbate supply concerns. Meanwhile, Iran’s Supreme Leader Ali Khamenei expressed pessimism about ongoing negotiations with the U.S., suggesting a resolution is unlikely. The combination of failed talks and rising military risks is likely to underpin oil prices in the near term.
Crude oil prices initially climbed but have since pulled back after testing a key resistance level at $63.90, as traders engaged in profit-taking and technical correction. The MACD indicator reflects waning bullish momentum, while the Relative Strength Index (RSI) has slipped to 59 after retreating from overbought territory—indicating the potential for continued short-term weakness.
If bearish momentum persists, oil prices could decline further toward the support level at $62.20. However, given the ongoing geopolitical tensions and fundamental risks to supply, any pullback may be limited.
A rebound could see crude retest the $63.90 resistance, and a breakout above that level may open the door for further upside.
Resistance Levels: 63.90, 65.10
Support Levels: 62.20, 61.00
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