The Strait of Hormuz is a critical artery for global oil supply, yet it remains under Iran's control. During the third round of nuclear negotiations between the US and Iran, American forces conducted an airstrike on Tehran, resulting in the death of Iran’s Supreme Leader Khamenei. Although President Trump initially claimed the conflict would end within four weeks, Iran’s missile and drone capabilities may now prolong the war.
In a recent press conference, Trump stated that the US-Iran conflict would conclude swiftly, though not within the current week. Later, via Twitter, he warned that any Iranian attempt to block the Strait of Hormuz would be met with a US response twenty times more severe than before.
Trump’s optimistic tone significantly influenced market sentiment. Yesterday, US crude oil WTI reached a high of $113 per barrel, marking a fresh peak since June 2022. However, the rally was short-lived. Starting at 1:00 PM Beijing time, prices began a sharp decline, eventually closing near $79, breaching the key $80 threshold.
The afternoon sell-off was largely driven by Trump’s comments, which led market observers to anticipate a quicker resolution to the US-Iran tensions. In effect, a single statement from Trump contributed to a one-day drop of $30 in crude oil prices, underscoring how influential figures can directly and powerfully sway markets.
Moving forward, market participants will monitor US actions closely. If Trump’s claims hold true—that Iran is neutralized and shipping through the Strait of Hormuz resumes normally—global oil prices could rapidly retreat to around $50, levels seen before the conflict escalated. Conversely, if US efforts fail to curb Iran’s missile and drone attacks, leaving the strait tense, oil prices may again test the $100 mark.
On the technical front, the daily chart shows a shift in US crude oil’s trajectory. The period before and after Khamenei’s death on February 28 reveals distinct patterns. Previous support and resistance levels near $54.86 and $62.36 now appear as boundaries of a prior consolidation phase. The uptrend that began on February 2 should be analyzed independently, as it may not be influenced by these earlier levels. The recent high of $113 on March 9 serves as a mid-term resistance. A mid-term low is still being established, with current prices moving within a new upward channel. A break below the channel’s lower boundary, accompanied by a bullish reversal pattern, would help confirm the next support level.