3X Long Labubu
Long-Term Investor, Hobby Trader
A possible US strike on Iran poses near-term upside risk for crude oil. If Trump expects to lose the midterms, he may act between Israel's October 27 election and the November 3 US vote. Crude has filled the $101 gap and reached the rising channel's midpoint; if it keeps breaking higher, the next levels are $105, $110 and the channel top near $115. x.comÂ
Fears of US strikes on Iran could send crude oil to $200 quickly. FinanceLancelot reports that the USS Theodore Roosevelt is heading to the Middle East and says the move has revived concern that Trump will follow through on threats to hit Iran after the midterm elections. x.comÂ
US energy stocks face pressure as the US-Iran memorandum of understanding reopens the Strait of Hormuz and lifts the US naval blockade. WTI broke below $80 from near $87 and could head toward $70, as oil, Treasury yields and the dollar broke lower together. Energy was the hardest-hit sector, while airlines rallied on relief from fuel costs. Lower oil eases inflation expectations, with headline CPI at 4.2% but core only 2.9%, removing pressure for Fed hikes. x.com x.comÂ
Oil's 14% plunge on the ceasefire is a chance to add energy, because a ceasefire is not a resolution and structural energy demand doesn't vanish. The Strait of Hormuz isn't open, Iran is demanding ships get permission to cross on a two-week clock, and WTI is still 44% above pre-war levels. The ceasefire bought time, not certainty, so the energy sector is worth buying near support around its 50-day moving average. x.comÂ
Oil stays above $80 well past the midterms because the supply problem persists despite peace headlines. Ships are still attacked near Saudi Arabia, Yemen and the UAE; a reported US strike on Iran's Konarak Naval Base ended nearly seven weeks without US strikes. There is nobody in Iran who can sign a deal and end the conflict. x.comÂ
Sustained high energy prices strain US farming, logistics, manufacturing and consumers, so crude oil should fall dramatically from its elevated level. Middle East and Russia tensions are lifting WTI, shown near $103, while Trump will likely step in at some point to reduce uncertainty. x.com x.comÂ
It is time to be long oil again as US officials say thousands of marines and ground forces will continue deploying to the Middle East. x.comÂ
Oil traders anticipate a resumption of the Iran war after the midterm elections, favoring more upside for crude oil. After a bullish reversal off its 10-week moving average, the odds favor a continuation of the rally to the $110-120 range. x.comÂ
Oil will come down significantly, because Trump will eventually make a deal with Iran and put the conflict to bed. x.comÂ
Crude oil looks set to rally sharply because yesterday's Russia-Ukraine deal was not the price-lowering move expected before the midterms. Trump's plans are unclear, but the anticipated pre-election relief now seems less likely; premium gasoline cost over $5 at one Texas pump yesterday. Middle East peace could still avert the rally. x.com x.comÂ