Brent Crude Surges More Than 4% Amid Escalating US-Iran Tensions
Brent crude surged more than 4% in Wednesday’s trading, extending its rebound from the key $70 support zone and gaining fresh momentum as geopolitical tensions between the United States and Iran intensified.
The latest leg higher was triggered by President Trump’s remarks that prospects for a deal with Iran were effectively over, following renewed exchanges of fire between the two countries. The developments undermined recent market optimism and revived concerns about potential supply disruptions, prompting a sharp rebound in oil prices.
While a bounce from the psychologically important $70 area was widely anticipated due to oversold daily conditions, the latest move suggests more than just a technical correction. With geopolitical risks once again taking center stage—the dominant driver of oil prices in recent weeks—the recovery has the potential to develop into a more sustained rally.
The daily technical picture has improved significantly. Brent has reclaimed the 10- and 20-day moving averages, broken above the upper boundary of the bear channel originating from the $112.70 peak, and moved through the 200-day moving average at $78.44. These developments now bring the key $80.00–18 resistance zone into focus, where psychological resistance converges with the 23.6% Fibonacci retracement of the $112.70–70.13 decline.
A decisive break above this region would provide the first meaningful signal that a broader bullish reversal is taking shape on the daily chart, potentially generating fresh momentum for a stronger recovery phase.
Momentum indicators also support the improving outlook. The 14-day momentum gauge is approaching its neutral line, while RSI continues to climb toward the pivotal 50 level. Further strengthening in these indicators would reinforce bullish signals and improve the prospects for additional gains.
Near-term price action is likely to remain highly sensitive to geopolitical developments. Any further escalation on the ground could add to the risk premium and drive oil prices higher, although traders remain cautious given the often unpredictable nature of political rhetoric and rapidly shifting headlines.
Under a bullish scenario, sustained gains above the 200-day moving average and a clear break of the $80 zone could pave the way for an advance toward $86.39, the 38.2% Fibonacci retracement, with the psychological $90 level emerging as the next major upside target.
Conversely, a de-escalation of tensions and a return to more conciliatory rhetoric could undermine immediate bullish momentum and leave the recent rebound vulnerable to fading. In that case, the recovery may prove to be only a corrective bounce within the broader downtrend, with a return below the broken channel resistance viewed as a minimum requirement for the larger bearish outlook to regain traction.
Res: 80.00; 80.18; 82.09; 85.29
Sup: 75.78; 73.11; 72.04; 70.50
