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Market Insights > Daily Market Analysis New

Oil Surges as U.S. Strikes Iran; WTI Tops $85

Published: 31 August 2026,07:05

Daily Market Analysis New

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Key Takeaways

*Brent crude surged back above $90, while WTI also climbed more than 2% as Middle East tensions intensified.

*U.S. strikes on Iranian positions near the Strait of Hormuz heightened concerns over potential disruptions to global oil flows, lifting the geopolitical risk premium.

*Further military escalation or disruption to tanker traffic could push oil higher, while diplomatic progress or stabilising shipments may trigger a pullback.

Market Summary:

Crude oil prices opened the week with a sharp gap higher, rising more than 2% as markets reacted to the latest escalation in the Middle East conflict over the weekend. Brent crude climbed back above the $90 per barrel level, while U.S. West Texas Intermediate also posted solid gains. The move was driven by heightened concerns over potential disruptions to global oil supplies following a U.S. military strike on Iranian positions.

On Sunday, U.S. forces targeted two Iranian rocket launchers on Larak Island in the Strait of Hormuz, marking the largest American military action in the region in approximately one month and the first known strikes on Iranian territory since late July. The operation was reportedly aimed at preventing the deployment of sea mines into the critical waterway. The Strait of Hormuz remains one of the world’s most important energy chokepoints, through which a significant portion of global crude oil typically flows. Any sustained threat to shipping traffic in the area immediately raises the risk premium embedded in oil prices. Adding to the uncertainty, tensions between Israel and Lebanon continue to complicate the broader regional security picture, further elevating geopolitical risk.

In the near term, oil markets are likely to remain highly sensitive to developments on the ground. Further military exchanges or any confirmed disruption to tanker traffic through the Strait of Hormuz could support additional upside in prices. Conversely, signs of de-escalation, diplomatic progress, or evidence that shipping volumes are stabilising would likely limit gains or prompt a pullback. Traders will also monitor inventory data and broader demand signals, but the immediate focus remains firmly on the evolving situation in the Middle East and its implications for supply security.

Technical Analysis

WTI Crude, H4

WTI crude has found solid support above the 61.8% Fibonacci Retracement level near $79.70, triggering a technical rebound and allowing the crude to regain bullish momentum.

The latest price action shows WTI now approaching its key downtrend trendline, which represents a critical technical hurdle. A decisive breakout above this resistance would mark a potential long-term structural break, signaling that the prevailing bearish structure may be coming to an end.

Should WTI gather sufficient momentum and sustain a move above the downtrend trendline, this could provide a strong bullish trend-reversal signal and open the path for further upside in the next leg.

Overall, $79.70 remains an important support level, while the downtrend trendline is the key resistance to watch. A sustainable breakout above this trendline would significantly strengthen the bullish outlook for WTI crude.

Resistance Levels: 92.35, 99.15

Support Levels: 84.70, 77.60

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