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WTI drops over 2% as traders eye potential new Iran sanctions
The report notes the 11 August EIA forecast keeping average Brent near $85 a barrel in Q3, while US commercial crude inventories remain a potential buffer against deeper declines.
WTI crude slid more than 2% on Monday, 24 August, as traders took profits and weighed expectations that the United States could announce a new round of sanctions against Iran, according to Action Forex.
The outlet also pointed to added geopolitical pressure, citing an Iranian authority responsible for the Persian Gulf and the Strait of Hormuz warning that vessels violating transit rules could face fines or detention.
On the technical side, Action Forex said WTI prices on the four-hour XTI/USD chart have been in a short-term uptrend since early August, with the trendline repeatedly acting as support. It added that the move is attempting to break below the trendline and under a market profile lower boundary at $86.05, with a next potential support area around $84.40 if selling accelerates.
Action Forex further highlighted that the US Energy Information Administration, in its 11 August forecast, expects average Brent to stay around $85 per barrel in the third quarter. It said persistently low US commercial crude inventories could help limit downside, and that momentum indicators have not yet confirmed the downside break, leaving the next move tied to how severe any new Iran sanctions package is.
Latest closeWTI crude $82.40 ▲1.4%|Brent $88.59 ▲1.8%