Crude oil prices retreated sharply Friday as West Texas Intermediate fell 1% to $70.98 per barrel following a volatile session. After climbing to $72.83 during European morning trading, WTI encountered aggressive selling pressure from New York traders that drove prices down to a session low of $70.70 within just two hours.
The intraday reversal highlights persistent market skepticism around Middle East ceasefire developments, with energy traders quickly fading geopolitical risk premiums. The rapid round-trip move suggests investors remain unconvinced about supply disruption risks despite ongoing regional tensions, with any war-related price spikes proving increasingly short-lived.
Oil traders are demonstrating growing resistance to sustained risk premiums as ceasefire negotiations continue their uncertain trajectory. The swift rejection of morning gains indicates markets are pricing in diplomatic progress or simply becoming desensitized to recurring geopolitical headlines from the region.
FXnCO Insight
Energy traders should fade geopolitical spikes in crude until sustained supply disruptions materialize, as the market is clearly refusing to maintain war premiums beyond brief intraday moves.
Source: FXStreet