Oil Prices Rise After Trump Rejects Iran’s Response to U.S. Peace Proposal

Oil at the Basic Level

Oil prices rose on Monday as trading began for the week, after President Trump described Iran’s response to the U.S. proposal to end the war as “totally unacceptable”.

Brent crude rose by more than 4% to reach levels of approximately $106.00 per barrel, while West Texas Intermediate (WTI) crude prices rose by 5% to reach levels of $101 per barrel.

The market was expected to show growing fatigue from the barrage of news and ongoing controversy; however, oil prices remain highly sensitive to events related to Iran, highlighting the significance of the ongoing supply disruptions in the Arabian Gulf.

Markets are currently focused on U.S. President Donald Trump’s meeting with Chinese President Xi Jinping later this week, amid renewed hopes that the talks will yield progress on Iran. Xi also wants to end the conflict, as instability in the Middle East threatens China’s oil supplies and weakens demand for Chinese exports. 

Oil at Technical Level

Crude oil prices are trading within a descending price channel on the 4-hour chart.

we expect them to retreat toward $94 and then $84 per barrel, near the lower boundary of the price channel.

However, if prices break above $101.50 with a close on at least a 4-hour candle, we expect the rally to continue toward $104 and then $108 per barrel.