Crude Oil (WTI)

Key insight

The US military is now on its 11th consecutive day of strikes against Iran, Trump has threatened strikes on Iranian nuclear sites, and Houthi attacks on Red Sea shipping persist — a geopolitical risk premium of $5–8/bbl is now baked into WTI, but an unexpected ceasefire or de-escalation would unwind it rapidly.

WTI has surged to a six-week high driven by escalating US-Iran military conflict and Strait of Hormuz supply fears, with price breaking above the prior $84.68 swing high resistance and now testing $86–88.

Main risk

Surprise US-Iran ceasefire or diplomatic breakthrough

Any credible de-escalation signal between Washington and Tehran would rapidly flush $5–8/bbl of war risk premium, with WTI potentially retesting the $80.49 Fibonacci 61.8% level or lower.