$95.50 in focus: WTI recovers to near this level on hopes of Iran peace talks

• WTI has recovered to around $95.30. The rebound comes in early Asian trading on Tuesday.
• Oil prices came under pressure after Tehran said Iran and the US remained in contact over ending their eight-month war.
• The search for a diplomatic resolution to the US-Iran conflict and the API crude oil stockpiles report will be key areas of focus for traders.

Around $95.30 is the current trading level for West Texas Intermediate (WTI). The US crude oil benchmark is regaining ground in Tuesday’s early Asian session, following a fall to $94.30 in the previous session, its lowest level since 16 October.

Talks to end the eight-month US-Iran conflict remain under way, Iran said, according to a Reuters report on Monday. Several days of discussions between Iranian officials and Qatari mediators had produced revised proposals, but no major breakthrough.

Iranian Foreign Minister Abbas Araqchi said: "Consultations through mediators are very intensive. We have presented our conditions and proposals and everything depends on the political rationality of Washington,"

Dialogue is Tehran’s preferred route to resolving problems, Iran’s President Masoud Pezeshkian said. US President Donald Trump had previously stated that he would not attack Iran before the US midterms.

Much of crude oil’s recent advance reflected risk premiums linked to a potential escalation, according to Ryan McKay, director of commodity strategy at TD Securities. He said hopes of a breakthrough to end the Iran war could therefore have a substantial effect on prices.

McKay added: “With that said, so long as there is no concrete conclusion to the war, and tanker and Houthi attacks remain prevalent, we do not anticipate a complete erosion of the risk premium via diplomacy headlines alone,”

Due later on Tuesday, the American Petroleum Institute (API) crude oil stockpiles report is the next release traders are awaiting. A drawdown larger than forecast would indicate stronger demand and could support WTI. Conversely, a bigger-than-expected build would point to weaker demand or excess supply, potentially weighing on the benchmark.

Crude risk premium eases on diplomacy news; full unwind seen as unlikely

TD Securities attributes part of the decline in crude’s risk premium to diplomatic developments. Recent “headlines and hopes of diplomacy have eroded some risk premium in crude oil markets,” the bank says. Reports of President Trump’s willingness to allow more time for talks have “seen a portion of the geopolitical risk premium priced out of crude oil and petroleum products.” With market “flows elevated, and a large portion of recent upside attributed to a risk premium, these headlines will have an increasingly large impact on the market.” Still, TD Securities warns that “headlines alone are unlikely to shed the whole risk premium”. It adds that “so long as there is no concrete conclusion to the war, and tanker and Houthi attacks remain prevalent, we do not anticipate a complete erosion of the risk premium via diplomacy headlines alone.”

100-day SMA underpins WTI’s positive technical outlook

Trading well above its 100-day simple moving average (SMA), WTI US Oil retains an apparently bullish near-term bias on the daily chart. The price is closer to the upper half of the recent Bollinger envelope, though still just below the middle band. That positioning suggests the latest rally is taking a pause before attempting higher levels. Directional momentum remains broadly neutral, with the Relative Strength Index (RSI) around 48.

The Bollinger middle band at $96.80 marks the first resistance level, followed by a firmer hurdle near $104.95 at the upper band. Immediate buying interest on the downside is concentrated around the current pivot zone. Below that lie support at the Bollinger lower band of $88.70 and the 100-day SMA near $85.85. A deeper pullback into that area would be expected to draw buyers and keep the broader uptrend intact.

(The technical analysis of this story was written with the help of an AI tool. Know more.)