Brent, WTI Reach Yearly High amid Escalations in Russia and Middle East

Brent, WTI Crude Oil News and Analysis

• Drone strike hits Russian oil infrastructure and Israel hits Iranian targets in Syria
• OPEC’s JMMC meeting unlikely to result in any changes
• Oil prices rise, testing levels of support in oversold territory
• See what our analysts foresee for oil prices in the second quarter via our Q2 oil outlook below:

Drone Strike Hits Major Russian Oil Refinery and Israel Attack Iranian Embassy in Syria

Iran has vowed to take revenge against Israel for its targeted strike in Damascus that killed two of Iran’s generals and five military advisers. The attack threatens to broaden the conflict in the Middle East after more than five months of the Israel-Hamas conflict in Gaza.

In addition, Ukraine has gone on the counter-offensive, attacking Russia’s main source of funding for the war – its oil infrastructure. The attack took place 1,300 kms from the front lines and is not said to have inflicted significant damage. Ukraine has been targeting various oil infrastructure in Russia in an attempt to cut off the main funding vehicle of Russia’s war on Ukraine.

OPEC’s JMMC Meeting Unlikely to Result in any Changes

OPEC’s Joint Ministerial Monitoring Committee (JMMC) is scheduled to take place online tomorrow but according to numerous sources, quoted by Reuters, there aren’t likely to be any changes in output.

OPEC+ members led by Saudi Arabia and Russia met last month and decided to maintain voluntary output cuts of 2.2 million barrel per day (bpd) in an attempt to support the oil market.

Oil prices now test $90 after a Ukrainian drone struck one of Russia’s major oil refineries

The oil market is heavily reliant on fundamental factors like demand and supply, find out what else oil traders ought to know about this unique market:

Oil prices rise, testing levels of support in oversold territory

Brent crude oi continues the four day lift after finding support at $85 and recently tagged the $89 mark. In addition, ascending resistance also highlights an interesting intersection between the horizontal level and the trendline (highlighted in orange). However, the oil market may be due a pullback as it comes perilously close to overbought territory and the intraday price action already reveals a slight step back from the $89 mark.

Brent Crude Oil Daily Chart

Source: TradingView, prepared by Richard Snow

WTI oil has also put in a test of the ascending resistance below the long-term level of resistance of $85.90/$86.00. Support emerges all the way back at $79.77 as the RSI appears moments away from oversold territory.

WTI Oil Daily Chart

Source: TradingView, prepared by Richard Snow

— Written by Richard Snow for DailyFX.com

Contact and follow Richard on Twitter: @RichardSnowFX