Crude Oil jumps above $72.00 on failed talks in the Middle East

• Crude Oil extends weekly gains, moving away from $70.00 and looking for more upside. 
• Markets are pricing in escalating geopolitical tensions after failed attempts from US Secretary of State Blinken in the Middle East. 
• The US Dollar Index fades after its steep rally earlier this week, focus on the US PMI on Thursday. 

Crude Oil prices continue to increase and extend weekly gains on Thursday, with traders focussing on the geopolitical side of the price action again. The repricing comes after US Secretary of State Antony Blinken failed to broker a diplomatic deal between Israel and Iran and even failed to convince Israel to allow humanitarian aid in the region. Markets are writing off his visit and attempts as a failed one, opening room for further escalations in the region. 

The US Dollar Index (DXY), which tracks the performance of the Greenback against six other currencies, fades on Thursday ahead of the preliminary US Purchase Managers Index (PMI) reading for October. The rally in the DXY was steep this week, with quite a few important pivotal levels being breached on its way up above 104.00. Less than 14 days before the US presidential election on November 5, expectations are that the Greenback will remain under pressure, primed for more upside. 

At the time of writing, Crude Oil (WTI) trades at $72.10 and Brent Crude at $76.00

Oil news and market movers: Saudi Arabia is losing 

• Saudi Arabia sees its revenue from Oil exports slump to the lowest in over three years. The main reason is sluggish demand growth, which weighs on Crude prices, according to Bloomberg.
• ExxonMobil has sold its onshore Oil and Gas assets in Nigeria to Seplat Plc for around $1.3 billion after approval from the Nigerian government, Reuters reports. 
• Mexican state-owned Oil company Pemex is said to have boosted its Gas and Oil reserves during President Claudia Sheinbaum’s term, several official documents showed, Reuters reports. 

Oil Technical Analysis: It becomes tricky

Crude Oil price is picking up and recovering further on Thursday, gaining ground and heading back to $75.00. The move comes after markets were too dialled in on the US presidential election and briefly forgot about the geopolitical card from the Middle East. The uneventful visit from Antony Blinken has pulled traders' attention back to the region, making clear that the tensions are far from over and can only escalate further. 

At the time of writing, Crude Oil price has risen above the 55-day Simple Moving Average (SMA) at $71.81, and needs to see preferably a daily close above it to confirm a breakout. Next up, the hefty technical level at $75.08, with the 100-day Simple Moving Average (SMA) and a few pivotal lines, is possibly the first big hurdle ahead. 

On the downside, traders need to look much lower, at $67.12, a level that supported the price in May and June 2023. In case that level breaks, the 2024 year-to-date low emerges at $64.75 followed by $64.38, the low from 2023.

US WTI Crude Oil: Daily Chart