Published: 5 March 2026,06:20
Daily Market Analysis New
*Oil has surged over 35% from January lows as escalating U.S.–Israeli conflict with Iran injects a heavy risk premium, with markets fixated on potential disruption at the Strait of Hormuz.
*Washington signaled Navy escorts and political risk insurance to stabilize tanker flows, aiming to contain supply shock and calm market fears.
*Despite reports of indirect outreach, both sides deny negotiations as crossfire continues—keeping crude elevated, with analysts warning prices could spike above $100 if disruptions persist.
Market Summary:
Oil prices have surged more than 35 percent from January lows, propelled to seven-month highs by escalating Middle East tensions following the outbreak of U.S.-Israeli military action against Iran. Entering day five of the conflict, the initial bullish momentum has stabilized as markets consolidate near recent highs, awaiting further clarity on the trajectory of the crisis—particularly developments concerning the Strait of Hormuz, through which approximately 20 percent of global oil supplies transit .
U.S. Treasury Secretary Scott Bessent signaled forthcoming announcements to support oil flows in the Persian Gulf, while President Trump referenced potential U.S. Navy escorts and government-backed insurance for tankers traversing the region. The administration has ordered the U.S. Development Finance Corporation to provide political risk insurance and guarantees for maritime trade, aiming to restore confidence in shipping channels and mitigate supply disruption risks.
A New York Times report indicating that Iranian intelligence operatives indirectly contacted the CIA through a third country to discuss terms for ending the conflict has contributed to a perceived mitigation of geopolitical tension. However, U.S. officials have emphasized that no active negotiations are underway, with Defense Secretary Pete Hegseth stating the operation is “just getting started” and that the military phase must “run its course” . Iran’s leadership has publicly denied any willingness to negotiate, with senior officials asserting, “We will not negotiate with the U.S.” and characterizing any such reports as unfounded.
Despite these mixed signals, crossfire between the parties continues unabated, with Iran’s Islamic Revolutionary Guard Corps claiming strikes on an American destroyer and threatening any vessels attempting to transit the Strait of Hormuz. Shipping traffic through the chokepoint has effectively ground to a halt, with maritime analytics firms confirming a “sustained commercial withdrawal from the corridor rather than temporary hesitation” . UBS analysts warn that if the closure extends beyond the next several weeks, Brent crude could exceed $100 per barrel, while Goldman Sachs has raised its Q2 forecasts to $76, citing structurally higher risk premiums . For now, crude is expected to remain bid with a significant war premium embedded, though prices may consolidate pending clearer directional signals from either diplomatic breakthroughs or further escalation.
Technical Analysis
Crude oil prices have executed a decisive technical breakout, surging above a long-term downtrend resistance line that had constrained the market since September 2023. This breach represents a significant structural shift, invalidating a multi-year bearish pattern and establishing a strong bullish bias for the commodity.
The breakout has propelled prices sharply higher, with the market now approaching a key pivotal level at $77.75. A sustained move above this threshold would provide further confirmation of the bullish reversal and open a clear path toward the psychologically significant $80.00 mark. The successful conversion of this resistance into support would reinforce the new uptrend’s durability.
Momentum indicators strongly support the bullish outlook. The Relative Strength Index has penetrated into overbought territory, reflecting robust and sustained buying pressure, while the Moving Average Convergence Divergence continues to edge higher with positive divergence, confirming that upside momentum remains firmly entrenched. This alignment between structural breakout and accelerating momentum provides compelling technical evidence for continued strength in the sessions ahead.
Resistance Levels: 83.13, 89.30
Support Levels: 72.90, 66.75
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