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Sahmino callsCommodity

Brent oilBRENTNeutral

Brent rebounded 6.1 percent from the $96 floor in three sessions but failed to break the $103.6 barrier; stance shifted from bearish to neutral

Horizon: Short-term (10 days, to 21 Mehr 1405)

Price when published

$102.25

That daydown0.5%

Support

$95.23

Resistance

$103.62

Invalidation

$105.95

The levels on the chart

Since writtendown1.4%

Conclusion

I'm turning neutral: despite intensified attacks on tankers, the return of West Asia exports to 98 percent of pre-war levels and the West's release of gasoil reserves caps the upside; I estimate about a 50 percent probability that Brent stays between $95.226 and $105.951 (closing) through 21 Mehr. Refining profitability is determined by the crack spread, not the oil level. Risk: a more effective strike on Persian Gulf exports or a temporary closure of Hormuz could break this range in a single session.

The evidence

  • The previous card (8 Mehr) was bearish at $96.375. According to Sahmino, Brent reached $102.25 on the morning of 11 Mehr (provisional); a 6.1 percent rise without touching the $95.226 support or a closing break of the $105.951 invalidation level.
  • Brent's 50-day moving average is now $96.58 and the 20-day average is $103.65 (Sahmino, 11 Mehr 1405); the current price sits between these two averages and just below the $103.619 resistance, meaning neither an uptrend nor a downtrend is established.
  • Brent now stands about 10 percent below its 52-week high ($113.61) and well above its 52-week low ($58.88) (Sahmino, 11 Mehr 1405).
  • From 7 to 11 Mehr, at least three tankers in the Strait of Hormuz and the Sea of Oman were targeted by unidentified projectiles; the latest incident was on Saturday, 11 Mehr, 4 miles off the coast of Oman (UKMTO, cited by Khabar Online/IRNA).
  • In contrast, JPMorgan on 8 Mehr put West Asia exports at 98 percent of pre-war levels (17.5 million barrels per day) and the West agreed to release 120 million barrels of gasoil reserves (Reuters/Mehr, 10 Mehr).

If it holds

If the $95.226 to $105.951 (closing) range holds, the market remains in balance between the war risk premium and the return of West Asia supply.

If it breaks

If a close above $105.951 is recorded, it means the war risk premium has again dominated the return of supply and this neutral reading is invalidated.

What to watch

The weekly U.S. oil inventory report, the next OPEC+ meeting, and fresh attacks on tankers in Hormuz or the Sea of Oman; a close below $95.226 would mean the return of the previous downtrend.

Every call on this symbol

18 calls; the move to the next call from the prices when written

  1. 3 October 08:44NeutralBrent rebounded 6.1 percent from the $96 floor in three sessions but failed to break the $103.6 barrier; stance shifted from bearish to neutral$102.25down1.4%
  2. 30 September 08:43BearishBrent fell 6 percent in a single day, breaking through the $103.2 support level and reaching the $96 range$96.38up6.1%
  3. 28 September 13:26NeutralBrent rose 3.5 percent in one session and clung to the top of the $108 channel$107.96down10.7%
  4. 26 September 08:36NeutralOur bearish view on Brent was invalidated: Yanbu missiles pushed the price above $103.87$104.32up3.5%
  5. 22 September 13:27BearishWhen the target fills in one session, the next question is: how much war premium is still left in the Brent price$98.64up5.8%
  6. 21 September 13:35BearishSaudi exports from Hormuz bounced back from 2.4 to more than 4 million barrels and ate up the disruption premium; my $101.513 support went too$101.44down2.8%
  7. 19 September 08:44NeutralTrigger for the drop found: half of pipeline capacity returns within days, and the Fed also raised rates$103.87down2.3%
  8. 14 September 11:19NeutralThe test we had set for ourselves for today came back failed; it didn't give back the risk premium, but we don't have a driver for it either$107.92down3.8%
  9. 12 September 10:23NeutralBrent went to $110.16 and gave back 5 percent of it; the risk premium has started to reverse and Monday tests it$104.61up3.2%
  10. 8 September 11:50BullishBrent broke through our $97.594 resistance and reached $99.1, but this price was built by fear and its counter-signal is also on the board$99.09up5.6%
  11. 2 September 08:59BullishBrent leapt again past the $94.65 resistance and climbed above $95; the trigger remains the retaliatory strikes in Hormuz$95.35up3.9%
  12. 1 September 12:23BullishBrent jumped 2.55 percent to $92.40, near the $94.65 resistance; outlook upgraded to cautious bullish$92.4up3.2%