Brent oil surged 11%: Trump's plan for the Strait of Hormuz heats up the market
On Monday, the oil market experienced its strongest surge since the escalation between the US and Iran began in late February. Brent crude (UKOIL) jumped nearly 11%, reaching $83.31, and bounced off the support zone of $71–$73. This rally has been one of the most notable in recent months.
Geopolitics Dictates Prices
The reason for this momentum is new strikes between Washington and Tehran, as well as the ambitious plan of the Trump administration to take direct control of the Strait of Hormuz. US military forces have carried out hundreds of strikes on Iranian targets, aiming to weaken Iran's ability to attack vessels in this strategic corridor, through which about a fifth of the world's oil trade passes.
In response, Tehran launched missiles and drones at US facilities in the region, again declared the strait closed, and warned vessels to strictly adhere to permitted routes. Shipping data already shows a collapse: in the 12 hours of Sunday, only nine vessels managed to pass through the strait, whereas the average daily number of transits before the start of military actions was close to 130.
Technical Picture: RSI Confirms Reversal
The daily Relative Strength Index (RSI) for Brent has broken through a downward resistance line that had been restraining the recovery since March, when the indicator peaked at 90. Sellers stopped the growth three times—in May at levels 64 and 58, and in June at 46. At the end of June, the RSI dropped to 27, entering near oversold territory, but in early July it finally surpassed the trend line and settled above the neutral level of 50.
The RSI is now at 55, indicating a shift in momentum to buyers. The signal will only turn bearish if the indicator falls back below 50 and breaks the broken line from below. Until this happens, momentum supports the recovery that began from the July low.
Brent Forecast: Key Level $90–$92
From February to May, Brent moved within a large symmetrical triangle, connecting a high around $118 and a low near $91. At the end of May, the price broke out of the triangle to the downside and by early July had fallen to the support zone of $71–$73. This zone held: buyers formed a base there over two weeks, and Monday's session allowed the price to rise 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 is 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 become active here again, 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.
The geopolitical risk premium is likely to persist as long as Iran continues to maintain 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.
Expert Opinion: The current spike is a classic example of how a geopolitical shock outweighs fundamental factors. However, investors should remember that if tensions ease, the market could correct just as sharply, especially if the $90–$92 zone is not broken.