West Texas Intermediate (WTI) oil futures on NYMEX experienced a sharp decline of 6% in one day, falling to near $90 during the European trading session on Monday, marking the lowest price in over two weeks [1]. This significant drop comes as market participants react to hopes that the prolonged closure of the Strait of Hormuz—a critical passage for nearly 20% of global energy supply—may soon be resolved [1]. Over the weekend, US President Donald Trump stated that an agreement with Iran for a permanent resolution, including the reopening of the Strait, has been 'largely negotiated.' However, Trump later clarified that there is 'no rush for the Iran deal,' emphasizing that the blockade will remain until an agreement is finalized, and Iran has not confirmed any progress in negotiations [1].
Oil prices had previously surged by over 68% in nearly two weeks following the onset of the Middle East war on February 28, but began to cool after both Iran and the US confirmed a temporary truce aimed at reaching a permanent resolution. Despite the recent pullback, WTI prices remain approximately 35% higher since the start of the conflict [1].
From a technical perspective, WTI trades with a bearish near-term bias, holding well below the 20-day exponential moving average (EMA) at $96.80. The Relative Strength Index (RSI) has slipped toward the low-40s, indicating persistent downside pressure but not yet reaching oversold territory, suggesting potential for further weakness if the EMA is not reclaimed [1]. If WTI fails to hold the $90.00 level, it could slide toward the May 6 low of $86.92, with a further downside target at the April 17 low of $78.88 [1].
No analyst opinions or forward-looking statements beyond technical analysis were provided in the source article.
CONCLUSION
WTI oil prices have tumbled sharply on optimism surrounding a potential reopening of the Strait of Hormuz, though official confirmation from Iran remains absent. The market remains volatile, with technical indicators pointing to further downside risk if key support levels are breached.