- WTI struggles to capitalize on the Asian session gains to a fresh high since May 19.
- Hopes for Middle East diplomacy prompt bulls to take some profits off the table.
- Supply disruption worries act as a tailwind amid a constructive technical setup.
West Texas Intermediate (WTI) – the benchmark US Crude Oil price – retreats after touching a fresh high since May 19, around the $104.00 mark during the Asian session on Friday, though the downside seems limited. The commodity currently trades above the $102.00 round figure, still up for the third straight day, as supply disruption worries counter hopes for Middle East diplomacy.
In the latest developments, US Vice President JD Vance sent a direct letter to the secretary of Iran’s Supreme National Security Council, Mohsen Rezaei, to restart peace negotiations. Furthermore, Qatar presented Iran with a new draft deal to end the war with the US and Israel. Meanwhile, Iran’s navy claimed Thursday that four oil tankers had struck sea mines in the Strait of Hormuz. Moreover, investors remain wary amid escalating hostilities between the Iran-backed Houthis in Yemen and Saudi Arabia. This keeps the geopolitical risk premium in play, which might continue to act as a tailwind for crude oil prices.
From a technical perspective, the black liquid retains a bullish bias following the recent breakout above the 100-period Simple Moving Average (SMA) on the 4-hour chart. Moreover, the recent advance within an upward-sloping parallel channel validates the positive outlook amid constructive momentum indicators. In fact, the Relative Strength Index (14) hovers around 57 and the Moving Average Convergence Divergence (MACD) has turned slightly positive, which together suggest that buyers still control the short-term tone, with the lower boundary of the channel at $100.49 acting as near-term underlying demand.
On the topside, the main resistance sits at the upper boundary of the ascending channel near $107.22, where a rejection would likely trigger consolidation or a corrective pullback. Meanwhile, crude oil prices would need to break below the channel support to signal a more meaningful deterioration of the bullish setup and set the stage for a fall to the 100-period EMA at $96.97.
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