Oil spiked on fake news—but didn’t fall when the story unraveled. That reaction says more about the market than the headline itself, pointing to strengthening underlying demand and persistent supply risks. With Brent crude now clearing the $106 level, attention shifts to resistance near $110, where a break could pave the way for a retest of the $120 highs seen at the onset of the Iran war.
The false headlines claiming explosions in Tehran, driven by viral social media posts using AI-generated or recycled footage, briefly suggested that the ceasefire had collapsed. Yet the critical takeaway is not the spike itself, but the aftermath. Once these claims were debunked, oil failed to retrace meaningfully. This lack of reversal suggests that underlying bullish pressure is building, independent of headline noise.
The key driver remains the unresolved situation in the Strait of Hormuz. Despite the extension of the ceasefire, the situation in the Strait remains tense. Reports of ongoing military activity in the Gulf highlight the fragility of the current arrangement. The ceasefire is more a pause than a resolution.
At the center of the issue is a fundamental disagreement between the US and Iran. Washington maintains that its naval blockade of Iranian ports is an enforcement of sanctions, while Tehran views it as a direct act of war. This divergence ensures that the risk surrounding roughly 15 million barrels per day of oil transit through the Strait remains firmly in place.
This backdrop is forcing a repositioning in the market. Traders who had anticipated a de-escalation and reduced exposure are now returning, driven by fears of prolonged supply disruptions. The shift from “selling the news” to rebuilding long positions is amplifying the upward move.
Technically, Brent’s break above 106.10 resistance marks a key turning point. The earlier decline from 114.81 appears to have bottomed at 87.79, and the trend is now shifting higher, supported by strong momentum. The bias has now shifted back to the upside, with prices expected to extend higher as long as 97.58 support holds.
The next key level to watch is the near-term channel resistance around 110.98. A decisive break above this zone would open the path toward a retest of the 119.70 high.
