We have quite a significant US military buildup in the region which as Amos Hawkstein suggests really sends a signal about what the United States is considering here. Dan, if we saw these US Iran tensions actually escalating further, what is the realistic worst case for energy markets and how quickly could prices react. Yes, we're seeing crude pull back today.Any thoughts on why. Yeah, I think I think that we we think about the worst case which which means upside price levels, you know, in a in a region whe ...

Market Overview - The oil market is expected to experience limited trading on Monday due to the Martin Luther King Jr. holiday in the United States, which may significantly impact market movements [1] - There is uncertainty regarding potential military action over the weekend, which could lead to volatility in oil prices [1] Technical Analysis - The candlestick patterns suggest that market participants may not anticipate military action, but the situation remains uncertain [2] - Brent Crude Oil tested the 50-week EMA at the $67 level but failed to maintain that level, currently trading below $65, indicating a major resistance barrier [3] - A support level is identified at $58.50, suggesting the market is attempting to find a bottom despite supply exceeding demand [4] Price Projections - If the market can break the 50-week EMA, there is potential for prices to rise significantly, targeting levels around $64 or $63.50 [2] - The prevailing market sentiment leans towards selling rallies, with expectations of a $5 consolidation range for oil prices [4]

Core Viewpoint - Oil prices have surged approximately 3.5%, reaching their highest levels in nearly three weeks due to potential new U.S. sanctions on Russian energy exports and a surprising decline in U.S. crude inventories [1][2]. Group 1: Market Reaction - Brent crude is trading around $63.40 per barrel, up 3.39%, while West Texas Intermediate (WTI) is at $59.30, up roughly 3.60% [2]. - The late-session rally was fueled by reports of the U.S. administration considering expanded restrictions on Russian crude and refined-product shipments, which could tighten global supplies amid increasing winter demand [2][4]. Group 2: Supply and Demand Dynamics - The U.S. Energy Department plans to purchase one million barrels for the Strategic Petroleum Reserve, alongside unexpected draws in gasoline and distillate stocks, indicating stronger domestic consumption than anticipated [3]. - Overall U.S. crude inventories have fallen more than analysts expected, further supporting price increases [3]. Group 3: Geopolitical Implications - Speculation suggests that Asian buyers may reduce Russian purchases if sanctions are expanded, potentially increasing demand for Middle Eastern and West African suppliers, which could strain shipping logistics and narrow available spot cargoes [4]. - The market is currently pricing in a risk premium related to U.S. policy uncertainty and the potential for constrained Russian supply [5]. Group 4: Market Outlook - Oil prices have rebounded approximately 8% this week, reversing much of October's decline as investors shift focus from fundamentals to geopolitical factors [6]. - The International Energy Agency (IEA) continues to forecast a global surplus through early 2026, with output growth from the U.S., Brazil, and Guyana expected to mitigate most geopolitical shocks [5].