Crude settles at $80.75 after breaking below critical support, signaling potential further declines amid rising global supply expectations.
Crude oil prices fell $4.13, or 4.9%, to settle at $80.75, breaking below a key support cluster near $85.45-$86.71. This zone had acted as a floor during the U.S.-Iran conflict but now shifts to resistance, raising concerns about sustained downward pressure.
Earlier, the area held firm as tensions drove supply disruption fears, with prices peaking near $86.35. Before the conflict, crude traded at $67.04, highlighting the geopolitical risk premium. Analysts now point to increased global supply, the reopening of the Strait of Hormuz, and potential Iran sanction relief as bearish catalysts.
The path of least resistance appears lower, though renewed conflict or Strait closures could reverse the trend. Sellers aim to prevent a rebound above $85.45 to maintain momentum.