Recap: The crude oil market settled over the $100 level for the first time since 2022 after Yemeni Houthis widened the Iran war by launching their attacks on Israel and as more U.S. troops arrived in the region. The market gapped higher on the opening from $101.24 to $102.60 and traded to $103.38 as the conflict was no longer concentrated in the Persian Gulf and around the Strait of Hormuz but extended into the Red Sea and the Bab el-Mandeb. The market later erased some of its gains and posted a low of $104.50 in early morning trading before it continued on its upward trend. The market was further supported as U.S. President Donald Trump issued another warning to Iran to open the Strait of Hormuz or risk U.S. attacks on its oil wells and power plants as well as Kharg Island. The oil market rallied to a high of $103.86 and settled in a sideways trading range ahead of the close. The May WTI contract settled up $3.24 at $102.88 and later rallied to a high of $105.36 in the post settlement period. The May Brent contract settled up 21 cents at $112.78. The product markets ended the session in mixed territory, with the heating oil market settling down 13.12 cents at $4.3643 and the RB market settling up 10.14 cents at $3.3515.
Technical Analysis: The oil market will likely continue to trend higher following Monday’s settlement over the $100 level. The market will remain well supported as the conflict spreads and the U.S. threatens Iran’s energy sites, despite the Trump administration stating that talks continue with Iran. The market will remain supported by the threat of damaged infrastructure and what it could mean for future production. The crude market is seen finding resistance at $105.36, $113.41, $119.48 and $123.68. Meanwhile, support is seen at $99.43, $92.08, $90.82, $89.51, $89.40, $86.46, $86.34, $84.37, $80.60, and $75.64.
Fundamental News: The White House said that talks with Iran were continuing and progressing well, adding that what Tehran says publicly differs from what it tells U.S. officials in private.
Israeli Prime Minister, Benjamin Netanyahu, said that he doesn’t want to “put a schedule on” the timeline for ending the war with Iran.
U.S. Treasury Secretary, Scott Bessent, said that the global oil market is well supplied, with more boats traveling through the Strait of Hormuz.
The Washington Post reported that the Pentagon is preparing for weeks of ground operations in Iran. The Post reported that whether President Donald Trump would approve plans for deploying ground troops remains uncertain.
The AAA reported that the average U.S. retail gasoline price stood at $3.99/gallon as of Sunday.
Sable Offshore said it has begun selling oil from its Santa Ynez Pipeline System offshore California to Chevron, after resuming crude transportation earlier this month.
IIR Energy said U.S. oil refiners are expected to shut in about 886,000 bpd of capacity in the week ending April 3rd, increasing available refining capacity by 143,000 bpd. Offline capacity is expected to fall to 589,000 bpd in the week ending April 10th.
The U.S. Federal Energy Regulatory Commission rejected Colonial Pipeline’s request for a rehearing after the regulator rejected the company’s proposed changes to how the country’s largest U.S. fuel artery handles gasoline shipments.
Early Market Call – as of 8:35 AM EDT
WTI – May $102.73, down $2.28
RBOB – Apr $3.3550, down 4.46 cents
HO – Apr $4.3158, down 12.82 cents
