Alert Level 1: Oil Prices Forecast to Reach US$128 per Barrel
Global oil prices are expected to continue their sharp rally amid escalating geopolitical conflict in the Middle East. Technical analysts at Reuters estimate that oil prices could surge to a range of US$120 to US$128, or approximately 2.16 million rupiahs per barrel, in the near term.
According to Reuters analyst Wang Tao’s report, Brent Crude Oil contracts could spike to a range of US$120.22 to US$128.26 per barrel. This projection emerged after Brent crude breached a significant resistance area between US$105.43 and US$108.48, forming a second runaway gap during Monday’s trading session.
The resistance zone was formed from a 38.2% Fibonacci projection level from wave C starting from US$58.81, as well as a 61.8% retracement from the downward trend that began at US$139.19. According to Wang Tao, these technical conditions indicate the market has entered an explosive bull run phase that is difficult to contain at any resistance level.
If this momentum continues, oil prices could potentially leap towards a range of US$134.40 to US$139.19 per barrel. This sharp increase is being driven by escalating conflict following attacks on Iran launched by Israel and the United States, which analysts believe could trigger a larger energy crisis compared to 2022.
From a technical standpoint, indicators also show potential aggressive targets as high as US$181.29 per barrel, which represents a 100% projection of the current wave C. However, given the extremely volatile market conditions, analysts find it quite difficult to identify strong short-term support levels.
Meanwhile, contracts for US crude West Texas Intermediate (WTI) are also expected to continue strengthening towards the 2022 peak of US$130.50 per barrel. This projection emerged after WTI prices jumped well above the significant resistance level of US$101.71, which represents a 61.8% retracement from the previous downward trend.
WTI contracts are currently believed to be in a strong wave C, which is the third wave of a long-term three-wave cycle since the low point of around US$17 in 2021. The negative level of US$40.32 that occurred in April 2020 is considered too extreme and is therefore not used as the basis for calculations.
Analysis of wave C projections shows a conservative target around US$144.39 and an aggressive target as high as US$204.15 per barrel. Both targets are deemed potentially achievable if the current global geopolitical situation continues to deteriorate.
In the very short term, the five-minute chart shows the initial support level at US$105.74 per barrel. If prices fall below this level, further correction could potentially drive prices down towards the US$103.50 per barrel area.