Crude Oil Outlook Turns Bullish Amid Escalating Middle East Tensions

Crude oil prices surged over 7% on Friday after Israel launched strikes on Iranian nuclear and military sites, sparking fears of supply disruptions. West Texas Intermediate (WTI) spiked to $77.62, and Brent reached $78.50 intraday—both logging their biggest one-day gains in over two years. Traders are closely watching the Strait of Hormuz, a critical chokepoint for 18–19 million bpd of oil flows. J.P. Morgan warned that in a worst-case scenario involving a Hormuz shutdown, oil could spike to $120–$130/bbl. While physical oil flows remain undisturbed, the geopolitical premium has been rapidly priced in. With OPEC+ holding spare capacity, some buffer exists, but uncertainty lingers. Technical resistance levels may cap further upside unless the conflict intensifies. Near-term sentiment remains bullish, but traders should brace for high volatility driven by geopolitical developments.