Crude oil held near recent highs on Tuesday as fears of imminent US attacks on Iran eased, but the market did not let go of its risk premium. Traders are still pricing in the chance that the next shift in the Middle East could come fast.
The reason is simple: the move lower in fear has not been matched by a real easing in the region. Talks between Saudi Arabia and Iran produced no meaningful breakthrough, and no agreement was announced to halt Houthi attacks or cool the Saudi-Houthi conflict. That keeps crude supported even after the latest pullback in strike fears.
Yesterday, the Houthis targeted the Saudi East-West oil pipeline pumping stations and Riyadh airport, underscoring why the market still treats escalation risk as a live issue. The East-West pipeline is a critical alternative export route, so any disruption around it reaches traders quickly. Disruptions in September already helped drive a surge in oil prices, and the current setup looks like a consolidation around those highs rather than a clean reversal.
On the chart, the picture is just as tight. Crude oil is consolidating around recent highs on the daily frame, with the lower bound of the channel and resistance around the 110.00 level acting as the main markers. A minor upward trendline still defines the bullish momentum on the four-hour chart, even as a smaller downward trendline shows the current pullback on the one-hour view.
That makes the next few sessions important. Today brings the US Consumer Confidence report, tomorrow brings the FOMC rate decision, and Thursday adds the US GDP report, the US PCE and the latest US Jobless Claims figures. Friday closes with the US Employment Cost Index, giving traders several chances to test whether the current price can hold its ground.
The friction in this market is that the support has not disappeared even as the most immediate strike fears have faded. A de-escalation in the Saudi-Houthi conflict or a surprising breakthrough in US-Iran negotiations would likely trigger a big correction, but neither has arrived. UBS has also added to the bullish backdrop, saying Brent could reach $110 by year-end and lifting its 2027 forecasts by $5, while Brent itself has eased to around $115. For now, oil is being held up by risk, not certainty.
