West Texas Intermediate (WTI) crude oil prices began the week with a decline, opening with a downward gap and retreating from the five-month high reached on Friday.
During Monday’s Asian trading session, the price of US crude fell below US$100.50 per barrel, as hopes for a resolution to the conflict in the Middle East dampened demand for assets that typically benefit from geopolitical risk.
Middle East Conflict Continues to Influence Oil Prices
On Sunday, US President Donald Trump ruled out the possibility of immediate military action against Iran.
This statement raised hopes that tensions in the region could be eased through negotiations.
However, uncertainty persists, with a US official reportedly stating that a military strike against Iran remains a possibility.
Meanwhile, the Iran-backed Houthi group in Yemen has threatened to continue attacks on the King Khalid International Airport in Riyadh, Saudi Arabia.
The stalemate in negotiations between the US and Iran, combined with security threats in the region, continues to provide support for oil prices.
The risk of supply disruptions has led investors to remain mindful of the potential for oil prices to rebound, despite the selling pressure seen early in the week.
Technical Indicators Still Point to Upside
From a technical perspective, the short-term outlook for WTI remains bullish, provided the price stays above the 50-period simple moving average on the four-hour chart and the 23.6% Fibonacci retracement level.
The MACD indicator, positioned slightly above the zero line, along with a Relative Strength Index (RSI) of around 55, suggests that upward momentum remains intact.
This creates the potential for renewed buying interest should the price decline toward specific support levels. WTI Support and Resistance Levels
Should selling pressure persist, the US$99.30 per barrel level serves as initial support for WTI. A further decline could push the price toward the US$97.83 and US$96.84 per barrel levels, which may attract buyer interest.
Conversely, the US$103.29 per barrel level acts as the immediate resistance that must be breached to strengthen bullish momentum. If the price successfully sustains a move above this level, WTI could potentially extend its previously established uptrend.
