• Investors take profits ahead of stricter US sanctions targeting Iranian oil exports and trading partners.
• Middle East tensions and Strait of Hormuz shipping disruptions fail to prevent oil’s short-term decline.
• WTI retains its bullish bias, holding firm above both the short-term nine-period and 50-period EMAs.

West Texas Intermediate (WTI) oil price depreciates after two days of gains, trading around $84.80 per barrel during the Asian hours on Monday. Crude oil prices decline as investors took profits ahead of an expected US announcement regarding stricter sanctions against Iran.

US Treasury Secretary Scott Bessent stated that Washington plans to impose the “toughest” sanctions in history, framing the measures as an unprecedented campaign of economic isolation designed to compel Iran and its trade partners into compliance. This policy shift threatens to further constrain global energy markets, particularly as Iranian oil shipments face severe disruptions and offers to Chinese buyers have dropped off amid an ongoing US naval blockade.

Tehran dismissed the impending measures as merely another ineffective attempt to exert economic pressure. Iranian officials emphasized that the country has decades of experience navigating blockades and possesses the resilience to sustain its economy and international trade relationships. Concurrently, geopolitical friction around the Strait of Hormuz remains acute, with vessel traffic through the critical oil transit corridor remaining significantly below historical averages.

Strait of Hormuz tensions and tight diesel stocks keep energy markets on edge

Commodity strategists at Commerzbank stress that “developments surrounding the Strait of Hormuz remain the focus of the energy markets,” with geopolitical risks continuing to dominate near‑term sentiment. They add that “since no other major reports are scheduled, attention is also likely to turn to inventory trends,” noting that “on the oil market, diesel inventories are particularly tight,” which reinforces the supportive backdrop for Brent.

Technical Analysis: WTI declines despite prevailing bullish bias

WTI US Oil trades at $84.80, maintaining a constructive bullish bias as price holds above both the short-term nine-period and 50-period Exponential Moving Averages (EMAs). The alignment of price over these key EMAs suggests underlying demand remains in control, while the 14-day Relative Strength Index (RSI) at 56.06 stays in neutral-to-positive territory, hinting at steady rather than overstretched upside momentum.

On the downside, initial support is seen at the nine-period EMA at $83.91, with a deeper floor at the 50-period EMA near $81.62 should a corrective pullback unfold. As long as WTI holds above these supports, the broader path of least resistance remains to the upside, with any dips likely to attract buyers rather than signal a decisive trend reversal.