WTI holds steady below $102.00 as diplomatic optimism counterbalances Middle East supply risks

• WTI sees little movement around $101.85 during early Asian trading on Friday.
• Iran receives outreach from US Vice President Vance, WSJ reports.
• Six missile and drone attacks targeted oil facilities, airports and a military position across Saudi Arabia, the Houthis say.

Hopes of renewed diplomacy between the United States (US) and Iran are tempering concerns over Middle East supplies, leaving oil prices largely unchanged. West Texas Intermediate (WTI), the US crude oil benchmark, trades near $101.85 in Friday’s early Asian session.

An effort to restart peace negotiations saw US Vice President JD Vance contact Mohsen Rezaei, Secretary of Iran's Supreme National Security Council, on Wednesday, according to The Wall Street Journal. US President Trump, meanwhile, said he had authorised Vance's approach, explaining that they "need help with medical supplies and various things.”

The prospect of US-Iran peace talks remains in focus for traders, alongside fears that an intensifying regional conflict could disrupt supplies from the Middle East.

According to a Thursday statement from Yemen's Iran-aligned Houthis, three ballistic missile attacks were directed at the Ras Tanura refinery and Saudi Aramco facilities in Abqaiq, both in Saudi Arabia's Eastern Province, as well as the Rabigh refinery on the country's Red Sea coast.

Two further operations targeted airports, Houthi military spokesman Yahya Sarea said. Missiles were used against King Khalid International Airport in the Saudi capital, Riyadh, while a drone targeted King Fahd International Airport in Dammam in the Eastern Province.

John Kilduff, a partner at Again Capital, said: “Those reports of a new spate of attacks helped oil recoup some losses later in the session,”

Can oil’s cautious optimism withstand Middle East risks and central bank concerns over energy inflation?

With President Trump keeping “the option of escalation after the midterms on the table.” Rabobank analysts stress that “uncertainty about the Middle East conflict continues to linger over markets,” They add that US officials have reportedly cautioned several allies in the region “to prepare for potential military strikes after the US polls, and the possibility that Iran may retaliate.”

Diplomacy also remains in play, with Rabobank highlighting “reports of ongoing diplomatic efforts.” Referring to the Wall Street Journal, the analysts say Vice President Vance has “reached out to the head of Iran’s Supreme National Security Council,” reportedly at Trump's request “in an attempt to restart diplomatic channels.”

Rabobank's assessment is that “oil markets currently seem to be trading the cautiously optimistic side of this binary outcome,” although it cautions that “the protracted energy inflation has global central bankers less optimistic.”

Technical Analysis: Can WTI sustain its positive outlook above the 100-day SMA?

A bullish bias remains evident on the daily chart for WTI US Oil, with prices comfortably above both the 100-day simple moving average (SMA) and the 20-day Bollinger Bands middle SMA. As the contract moves towards the upper Bollinger Band, the Relative Strength Index (14) stands at 63.84, in bullish territory but below overbought levels. This points to favourable upside momentum, albeit with scope for periods of consolidation.

The upper Bollinger Band at $105.55 marks the first resistance level, where another advance by buyers could encounter fresh supply. Initial downside support lies near $96.15 at the 20-day Bollinger Bands middle SMA. Below that, the lower Bollinger Band at $86.78 and the 100-day SMA at $85.50 define a wider demand zone that would be expected to limit deeper corrective declines.

(The technical analysis of this story was written with the help of an AI tool. Know more.)