Trump Threatens Oman

Crude oil prices continue to drift higher today as optimism around any potential peace deal between the US and Iran fades further. Yesterday, Trump threatened to target Oman if it interfered in his negotiations with Iran after Oman and Iran continued their negotiations aimed at managing traffic through the Strait of Hormuz via tariffs. Trump warned Oman not to enter the arrangement or risk coming under attack from the US military. Meanwhile, Iran has reportedly drawn up a list of terms it demands from the US in exchange for reopening the Strait.

Peace Deal Expires

Tensions remain elevated following the expiry of the 60-day peace window on Monday. The memorandum signed in June allowed for 60-days of ceasefire to facilitate negotiations between the two sides. However, the ceasefire technically broke down over a month ago, from which point fighting has been intensifying. Trump said this week he had no interest in extending the peace window and so, for now, uncertainty remains elevated and crude prices look vulnerable to fresh upside spikes in response to any escalation in violence, particularly if Trump does attack Oman.

Technical Views

Crude

The rally in crude is stalled for now into the 84.60 level currently. Momentum studies are skewed to the upside suggesting risks of a fresh break higher. If we do push north from here, 95.06 will be the next target for bulls. To the downside, 77.65 is the key support to watch.