Oil dips as US, Iran near possible deal on Strait of Hormuz

FUNDAMENTAL VIEW

Crude oil fell yesterday after reports that the United States and Iran are discussing a phased agreement to reopen the Strait of Hormuz and end the US blockade. Iran has submitted a proposal, pledging to reopen the waterway within seven days if Washington meets its conditions. Iranian Foreign Minister Araghchi will remain in New York over the weekend to await a US reply.

A diplomatic breakthrough would likely drive oil prices sharply lower, while a prolonged deadlock or further escalation should keep the market supported and push it toward new highs.

President Trump currently faces numerous constraints, making a resolution to the conflict more probable than not. The only uncertainty is the timeline, and that has been the primary driver of recent price action.

CRUDE OIL TECHNICAL VIEW – DAILY

Crude oil pulled back to the key 93.00 zone on renewed hopes for a US-Iran deal. Buyers are expected to enter near these levels, with a defined risk below the zone, aiming for a rally to the 110.00 resistance. Sellers, on the other hand, will look for short positions below 93.00 to target a drop to the channel's lower bound around 85.00.

CRUDE OIL TECHNICAL VIEW – FOUR-HOUR

Price action around the 93.00 zone may become choppier toward the weekend due to gap risks. Again, buyers are likely to step in near these levels to target new highs, while sellers will seek short entries below the zone to extend the decline.

CRUDE OIL TECHNICAL VIEW – HOURLY

The price has broken below a minor upward trendline that had been defining the bullish momentum. If a pullback retests that trendline, sellers are expected to step in with a defined risk above it to position for a drop to 85.00. Buyers, conversely, will want to see the price rise back above the trendline to increase bullish bets toward 110.00.

UPCOMING EVENTS

No economic releases are scheduled for today, but traders will closely monitor US-Iran developments after yesterday's proposal to reopen the Strait of Hormuz under certain conditions.