USO Gains Tracking Oil’s Rally Amid Middle East Geopolitical Tensions

• • WTI crude oil rose roughly 1.9% today as geopolitical concerns flared up again in the Middle East.
• • Tensions around the Strait of Hormuz and a global diesel shortage are adding further pressure to energy markets, pushing prices close to this month’s highs.

WTI crude oil rose roughly 1.9% today, driven by renewed geopolitical concerns over potential disruption to the Strait of Hormuz, a vital shipping lane that remains a key pressure point for supply. Middle East crude exports have actually recovered to around 12.8 million barrels per day, offering some relief, but US-Iran negotiations over reopening the strait remain stalled. A global diesel shortage stemming from limited refining capacity is adding further pressure to petroleum product prices overall. The current price sits around $153.53 (Rp2758934), taken from the midpoint of two independent market data sources showing a tight spread of under 0.5% ($153.84 and $153.21), and is up roughly 19.6% over the past 30 days, now only about 5.8% below its all-time high. With entry in that area, a first target of $158.13 (Rp2841596), about 3.0% from entry, and a second target of $162.74 (Rp2924438), about 6.0% from entry, near the record high, look achievable if geopolitical tensions persist.

Oil prices are highly sensitive to diplomatic developments - a sudden breakthrough in US-Iran negotiations over the Strait of Hormuz could trigger a sharp, fast correction. This scenario is invalidated if price breaks below $147.40 (Rp2648778).