WTI falls toward $81.00 as Israel and Iran downplay the risk of further escalation

FXStreet
Updated Apr 22, 2024 06:56
Mitrade

■WTI Oil price depreciates on de-escalated geopolitical tensions in the Middle East.


US House passed new sanctions on Iran’s oil sector set to become part of a foreign-aid package.


The hawkish sentiment surrounding the Fed’s monetary policy puts pressure on the crude Oil’s outlook.


West Texas Intermediate (WTI) Oil price trades around $81.20 per barrel, hovering around its monthly low of $81.05, marked on Thursday. The decline in crude Oil prices can indeed be linked to eased geopolitical concerns in the Middle East, particularly following Reuters reports that Israel and Iran downplayed the risk of further escalation after Israel's strike on Iran.


Meanwhile, the passage of new sanctions on Iran's Oil sector by the US House, as reported by Bloomberg on Saturday, could also have implications for Oil prices, and restrict its ability to export crude Oil. This can reduce global Oil supply and contribute to upward pressure on prices. However, the impact of such sanctions on Oil prices depends on various factors, including the extent of the sanctions, and the response of other Oil-producing countries.


The expansion of secondary sanctions to cover transactions between Chinese financial institutions and sanctioned Iranian banks used for purchasing petroleum and Oil-derived products could indeed impact the crude Oil market.


On the demand side, the outlook for crude Oil is influenced by expectations regarding US monetary policy. The Federal Reserve's (Fed) indication that it may keep interest rates higher for longer, driven by concerns about persistent inflation, can affect the price of Oil. Higher interest rates tend to strengthen the US dollar (USD), making Oil more expensive for countries using other currencies, which can dampen global demand and contribute to lower prices.


The hawkish remarks from Federal Reserve officials, such as those made by Chicago Fed President Austan Goolsbee and Atlanta Fed President Raphael Bostic, reinforce expectations of a tighter monetary policy stance, which could further support the US dollar and potentially weigh on crude Oil prices.


WTI US OIL


Overview

Today last price

81.15

Today Daily Change

-0.91

Today Daily Change %

-1.11

Today daily open

82.06

 

Trends

Daily SMA20

83.84

Daily SMA50

80.65

Daily SMA100

76.93

Daily SMA200

79.59

 

Levels

Previous Daily High

85.53

Previous Daily Low

81.11

Previous Weekly High

85.67

Previous Weekly Low

81.05

Previous Monthly High

83.05

Previous Monthly Low

76.5

Daily Fibonacci 38.2%

83.84

Daily Fibonacci 61.8%

82.8

Daily Pivot Point S1

80.27

Daily Pivot Point S2

78.48

Daily Pivot Point S3

75.84

Daily Pivot Point R1

84.69

Daily Pivot Point R2

87.32

Daily Pivot Point R3

89.11

* The content presented above, whether from a third party or not, is considered as general advice only.  This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.

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