Key Points
- CL-OIL traded at 97.859, up 0.107, or 0.11%, with a session high of 97.929.
- Brent crude increased toward $107 a barrel, while West Texas Intermediate traded close to $102 a barrel.
- The IEA warned that the market will remain severely undersupplied until October, even if hostilities end next month.
- Trump and Xi discussed keeping Hormuz open to support energy trade, according to a White House official, though China’s official readout did not list energy among the topics.
Oil prices were on track for a weekly gain as the Strait of Hormuz remained closed and efforts to end the Iran war stayed in limbo. Brent crude increased toward $107 a barrel, while West Texas Intermediate traded close to $102 a barrel.
On the chart, CL-OIL traded at 97.859, up 0.107, or 0.11%, at 05/15 04:20:34 GMT+3. The session high stood at 97.929, with a low of 97.184, an open at 97.732, and a close at 97.520.
The market is no longer trading only on ceasefire headlines. Traders now want proof that shipping can move safely again. The US naval blockade of Iran’s ports remains in place, while the waters around the Strait of Hormuz remain dangerous for commercial vessels.
A commercial vessel was seized by unauthorised personnel near the entrance to the strait and taken toward Iranian waters, adding fresh pressure to the shipping-risk premium. A UK naval group reported that the vessel was taken off Fujairah and headed for Iranian waters, while other reports said the incident came as Tehran continued to exert control over shipping in the region.
Trump-Xi Talks Add A Demand And Diplomacy Angle
Oil traders also watched the Trump-Xi summit closely. Trump met Chinese leader Xi Jinping on Thursday, and the two discussed keeping the Strait of Hormuz open to support energy trade, along with improving American oil flows to China, according to a White House official. China’s official readout did not include energy among the topics, but it did say the Middle East was discussed.
That gap between the US and Chinese readouts keeps the market careful. If Beijing and Washington can align on energy flows, oil may lose part of its panic premium. If the summit produces no clear energy pathway, traders may keep pricing the risk that Hormuz remains a chokepoint through the northern summer.
China’s role also matters because Iran has reportedly started allowing some Chinese vessels to move through the Strait of Hormuz after an understanding between Tehran and Beijing. The strait carries around 20% of global oil and gas shipments, so even limited vessel movement can shift expectations around supply relief.
Trump added another layer of uncertainty in a Truth Social post early Friday, saying “the military decimation of Iran (to be continued!)” while also saying that he hoped the US relationship with China would be “stronger and better than ever before.” That mix leaves traders balancing diplomacy with renewed conflict risk.
IEA Warning Keeps The Supply Premium Alive
The International Energy Agency gave oil bulls a strong supply-side argument this week. It said the war has driven global oil inventories down at a record pace and warned that the market will remain severely undersupplied through the end of the third quarter, even if the conflict ends by early June. Its base case points to inventories falling until the final quarter of the year, when a modest projected surplus may begin to appear.
That warning keeps dip buyers active. A closed Hormuz, a US blockade, and falling inventories make it harder for crude to sell off sharply, even when traders worry about demand.
US inflation data has raised the political pressure too. The oil shock is feeding back into domestic prices, piling pressure on Trump ahead of the midterm elections in November. Higher fuel costs can weaken consumer sentiment, raise transport costs, and complicate the Federal Reserve’s path if inflation stays firm.
Ceasefire Holds, But Peace Talks Struggle
A ceasefire has been in place since early April, despite several flareups. Yet Washington and Tehran appear to be making little progress toward resolving their core disputes.
Trump recently said the truce was on “massive life support” while criticising Iran’s response to his proposal to end the war. That language keeps crude sensitive to every headline around talks, ship movements, and military activity.
For oil, the ceasefire alone is not enough. The market needs a route back to normal flows. Until tankers can move through Hormuz without escorts, seizures, or military warnings, traders are likely to keep some supply-risk premium in Brent and WTI.
Read more about our expert analyst insights about oil and its effect on the world economy.
Technical Analysis
CL-OIL is continuing to trade in a broad consolidation phase around 97.85, with the market struggling to regain the explosive momentum that previously pushed crude toward the 119.42 peak in March. Price action has become increasingly compressed over recent sessions, suggesting traders are waiting for a stronger macro or geopolitical catalyst before committing to the next directional move.
Technically, the chart is neutral in the short term:
- MA5: 98.51
- MA10: 98.85
- MA20: 98.07
The moving averages are tightly clustered and beginning to flatten, which usually reflects a loss of trend momentum and a transition into range-bound trading conditions. Price itself oscillates directly around the moving average cluster, reinforcing the indecisive structure.
Key levels to watch:
- Immediate support: 97.00 → 95.00
- Major support: 87.25
- Resistance: 100.00 → 106.00 → 119.42
The 97–98 region has now become the key short-term pivot zone. Buyers have repeatedly defended this area during May, preventing deeper downside follow-through despite fading momentum.
On the upside, crude still needs a decisive move back above the psychological 100 handle to restore stronger bullish sentiment. A breakout there could reopen a move toward the broader resistance zone around 105–106, where previous rallies began fading.
However, if price slips below 95, the consolidation structure could deteriorate into a deeper retracement toward the major support region near 87.
The broader macro backdrop remains mixed for oil. Supply-side concerns and geopolitical tensions continue to provide underlying support, but softer global demand expectations and cautious sentiment around Chinese industrial activity have limited aggressive upside continuation.
Markets are also watching OPEC+ policy signals closely, alongside US inventory data and broader economic indicators tied to manufacturing and transport demand. At the same time, the recent stabilisation in the US dollar has slightly reduced some of the tailwinds commodities previously enjoyed.
Volume has moderated compared with the March rally phase, which supports the view that the market is consolidating rather than entering a fresh breakout cycle immediately.
For now, CL-OIL maintains a neutral-to-cautiously bullish bias while holding above the 95–97 support zone, though stronger upside momentum likely requires a sustained break back above 100.
Cautious Forecast
CL-OIL may stay range-bound while it trades below 98.858 but above 97.184. A close above 98.858 would support a stronger move toward 105.968, especially if Hormuz remains shut and inventory pressure deepens.
A break below 97.184 would show that traders are fading the supply-risk premium, but downside may stay limited while the US blockade remains in place and the IEA continues to flag severe undersupply until October. The next clean move likely depends on vessel safety in the Strait of Hormuz, the next signal from US-Iran talks, and whether Trump-Xi energy discussions lead to practical supply relief.
Learn more about trading Energies on VT Markets here.
Trader Questions
Why Are Oil Prices Heading For A Weekly Gain?
Oil prices are heading for a weekly gain because the Strait of Hormuz remains closed and peace efforts around the Iran war remain stalled.
Brent crude increased toward $107 a barrel, while West Texas Intermediate traded close to $102 a barrel.
What Is The Current CL-OIL Price?
CL-OIL traded at 97.859, up 0.107, or 0.11%.
The session high was 97.929, with a low of 97.184, an open at 97.732, and a close at 97.520.
Why Is The Strait Of Hormuz Driving Oil Prices?
The Strait of Hormuz is driving oil prices because it remains one of the world’s most important oil and gas transit routes.
The strait carries around 20% of global oil and gas shipments. Any closure or shipping risk can quickly lift freight costs, insurance costs, and the supply-risk premium in Brent and WTI.
How Is The Iran War Affecting Oil Supply?
The Iran war is affecting oil supply by keeping the Strait of Hormuz closed and leaving the US naval blockade of Iranian ports in place.
The market is also reacting to reports that a commercial vessel was seized by unauthorised personnel near the entrance to the strait and taken into Iranian waters.
Why Are Traders Still Pricing A Supply-Risk Premium?
Traders are still pricing a supply-risk premium because the ceasefire has not restored normal shipping flows.
A ceasefire has been in place since early April, but Washington and Tehran appear to be making little progress toward a full agreement. Until vessels can move safely through Hormuz, oil prices may stay supported.
Start trading now – Click here to create your real VT Markets account
