Brent Oil Extends Rally as Escalating Geopolitical Risks Fuel Supply Concerns

Brent crude extended its sharp rally on Friday, climbing to its highest level since early May as mounting geopolitical tensions continued to fuel concerns over potential supply disruptions. The benchmark built on Thursday’s 2.6% surge, adding a further 1.4% in early trading as bullish momentum remained firmly in place.

Markets remain focused on the deteriorating situation in the Middle East, particularly developments involving Yemen and Iran. Growing fears that the conflict could escalate further have heightened worries about global supply risks, helping drive oil prices nearly $5 higher in less than two trading sessions.

The decisive break above the key $110 resistance level has significantly strengthened the bullish outlook. This barrier had repeatedly capped gains during mid-September and again earlier this week, making the latest breakout an important technical milestone. The move has opened the way toward the next major targets at $119.29, the 76.4% Fibonacci retracement of the broader $138.22-$58.00 decline, and the psychologically significant $120 area, which also marks the highs seen in March.

Brent is now on track for a fourth consecutive weekly advance and appears set to secure a weekly close above the pivotal $110 level. The bullish technical picture is increasingly supported by favorable fundamentals, as supply concerns continue to underpin market sentiment.

Near-term upside targets are located at $115.37, representing the 138.2% Fibonacci projection of the rally from $95.11, followed by $117.10 and $118.83, corresponding to the 150% and 161.8% projection levels respectively.

However, traders should remain alert to the possibility of consolidation or limited profit-taking after the recent sharp gains. Daily momentum indicators are approaching overbought territory, which may slow the pace of the advance and trigger short-term corrective moves.

Despite the risk of near-term pullbacks, the broader bullish structure is expected to remain intact while Brent holds above the $110 support zone.

Res: 115.37; 117.10; 118.83; 119.70
Sup: 112.72; 111.06; 110.00; 109.60