The "black gold" market is experiencing a massive surge in volatility. On Monday, the price of benchmark Brent crude jumped nearly 11%, reaching $83.31 per barrel. This surge is one of the most significant since the escalation of the US-Iranian confrontation in late February.
The Strait of Hormuz in the Crosshairs: How US Actions Fueled Oil Prices
The reason for such a sharp move is not just rumors, but concrete actions. US military forces launched hundreds of strikes on Iranian targets, followed by several dozen more on Sunday. The official objective, as stated by US Central Command, is to weaken Tehran's ability to attack vessels in the strategically vital Strait of Hormuz. Iran's response was swift: missiles and drones were fired at US targets in the region, and Tehran once again declared the strait closed, warning vessels to strictly adhere to permitted routes.
Washington, in turn, announced its intention to take direct control of the strait. It is worth recalling that in peacetime, about one-fifth of the world's oil trade passes through this narrow corridor. Shipping data already indicates a collapse: in the 12 hours of Sunday, only nine vessels managed to transit the strait, whereas the average daily number of transits before the hostilities began was close to 130.
The reaction of stock markets is mixed. Japanese stocks lost 82 trillion yen over three weeks, and the Nikkei 225 index fell nearly 2% on Monday. For oil contracts, on the contrary, the reassessment of risks resulted in a sharp rally. South Korean stocks continued their decline, mainly driven by chipmakers.
Technical Analysis: Brent RSI Breaks Resistance After Three Failures
From a technical standpoint, the signal is extremely bullish. The daily RSI for Brent has risen to the 55 level and consolidated above the neutral 50 level, clearly indicating a shift in momentum to buyers. Previously, the price recovery was constrained by a downward resistance line formed after the March RSI peak at 90. Sellers stopped the rally three times: in May at levels 64 and 58, and in June at 46.
At the end of June, the momentum indicator dropped to 27, entering near-oversold territory. In early July, the RSI finally broke above the downward trend and moved above the neutral zone, confirming the breakout. The bearish signal will only reverse if the RSI falls back below 50 and breaks the support line. Until then, momentum supports the recovery that began from the July low.
Brent Price Forecast: Key Level $90–$92
From February to May, Brent moved within a large symmetrical triangle, connecting a high near $118 and a low around $91. At the end of May, the price broke down from the triangle and by early July fell to support at $71–$73. This zone held: buyers established a base there over two weeks, and Monday's session allowed the price to move higher. Brent opened near $78 and reached a high of $83.54 during the day — a gain of 10.76% at the time of publication.
The next significant resistance lies in the $90–$92 area. In the spring, this zone acted as support for the triangle, and now it has become a key confirmation of the downside breakout. If sellers re-emerge here, it will confirm the bearish scenario, and the price could return to $71–$73. If Brent closes the day above $92, it will invalidate the downside breakout and restore the bullish sentiment from the start of the year.
My view: The geopolitical premium is likely to persist as long as Iran maintains tension in the Strait of Hormuz. The $90–$92 range will be decisive for the current recovery: whether Monday's surge becomes a reversal or another lower high. With RSI and volumes on the side of buyers, I expect a test of this level in the coming days.