Oil benchmarks extended their slide while natural gas held firm as the 11-week-old US-Iran cease-fire continued to strip geopolitical risk from energy markets, returning prices to supply-and-demand fundamentals.
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WTI crude breaks below $76 as cease-fire removes risk premium
Oil benchmarks extended their slide while natural gas held firm as the 11-week-old US-Iran cease-fire continued to strip geopolitical risk from energy markets, returning prices to supply-and-demand fundamentals.
WTI crude fell to $75.12 a barrel on the 4-hour chart, breaking below the $79.81 support level of a symmetrical triangle that had contained the downtrend since the $91.84 high. The breakdown confirmed a bearish continuation pattern, with the next downside target at the $68.50 Fibonacci extension area. Brent crude traded at $78.60, testing the floor of its rising channel after failing at the 50-period moving average near $86.02, with support at $77.88 and resistance at $80.65.
"The cease-fire has removed the geopolitical bid that was supporting prices through the first quarter, and the market has reverted to a supply-driven narrative," said Arslan, a finance MBA and MPhil in behavioral finance who specializes in financial analysis and investor psychology. "WTI's failure at the 50 moving average around $85, followed by strong bearish engulfing candles, shows sellers have regained control."
Tankers have gradually resumed transit through the Straits of Hormuz after more than 11 weeks of the conditional cease-fire between the US and Iran, according to the source report. US crude production remains near record highs, while OPEC+ has maintained output discipline. Supply growth outside the alliance — from Brazil, Guyana and Canada — continues to add to global inventories. Global demand is recovering at a slower pace, particularly in Asian markets, as higher interest rates in developed economies constrain spending. The RSI on WTI's 4-hour chart remains below 40, indicating sustained selling momentum, while the $79-to-$82 range has emerged as a failed value area where buyers were previously overwhelmed.
Natural gas charts a different path
Natural gas futures traded at $3.170, holding above the 50-period moving average near $3.15 on the 2-hour chart. The contract has formed a series of higher highs and higher lows since the $3.099 swing low, trading within an ascending channel. The RSI has moved back above 50, and the Volume Profile identifies the $3.10 area as a support level. Resistance sits at $3.203, with the next upside target at the $3.297 Fibonacci projection.
The divergence between oil and gas reflects different supply-demand dynamics. While the cease-fire has eased concerns over LNG shipping routes and softened spot prices, US and European inventories remain healthy after mild spring weather. LNG demand is expected to remain solid over the long term in both Asia and Europe, providing a floor under prices.
What's at stake for energy markets
The bearish breakdown in WTI with a target near $68.50 signals potential further downside for crude markets, which could weigh on energy sector stocks and ease inflation expectations in the near term. The divergent path for natural gas creates potential trading opportunities between the two commodities. Market attention now turns to upcoming US inventory data and the next OPEC+ meeting, which will determine whether supply discipline holds. The cease-fire remains conditional, and any deterioration could reintroduce the geopolitical risk premium that has been stripped from prices over the past 11 weeks.
This article is for informational purposes only and does not constitute investment advice.
