Weekly Oil Report: Escalating Tensions Turned Sentiment Bullish

Crude oil surged to its highest level since December with Brent closed at $83.10 and WTI around $78.12.

Weak movements of Brent finally ended with about 6% growth in the last week of January. On Friday, it broke through the quarterly pivot point while moving inside a thick Ichi cloud. The upfront resistances are shown on the 4h chart. The sentiment is extremely bullish due to the escalating tensions in the Middle East.

Although oil prices are rising because of geopolitical disputes, some experts believe that the market is underestimating the tensions.

Red Sea blockage forced more vessels to reroute their journey to avoid the Suez Canal chokepoint. Inflationary pressure on shipping lines is provoking freight hikes, particularly for oil and container shipments.

In addition to the rising chaos, the U.S. Energy Information Administration (EIA) reported an inventory drop last week. The report caused more bullish sentiment.

Bitumen took different directions in several regions. Iran’s market had 12% competition on VB on Saturday in addition to last week’s 13% increase. Prices are moving after a couple of weeks of stability.

In Singapore, prices were almost stable. However, the price may increase because of oil hikes and rising demand.

The slow-rising trend of the Europe market also continues due to the persistent cold wave.

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