US-Iran deal hopes weigh on WTI as it trades below $85

• Oil remains near its 10-week low of $84.25 as hopes build for a US-Iran deal.
• Fresh military strikes on Iran are “highly unlikely”, according to US President Trump.
• Democrats have signalled that they would press for restrictions on funding for the Iran war.

Selling pressure has left West Texas Intermediate (WTI) futures on NYMEX trading just below $85.00, down 1.5% during Tuesday’s Asian session. Prices remain near Monday’s 10-week low of $84.25.

Growing optimism over an agreement between the United States (US) and Iran is weighing heavily on oil prices.

Can a softer US-Iran tone keep oil sentiment steady?

A less confrontational message from Washington gave investor optimism a further lift over the weekend, according to analysts at MUFG. Speaking to CNN, President Trump said it was “highly unlikely” he would have to authorise fresh military strikes on Iran if negotiations continued to make progress. However, MUFG points out that Trump made the outcome conditional on the quality of a deal, saying “it depends on whether or not they sign a very strong agreement,” a qualification the bank regards as critical to sustaining the recent decline in geopolitical risk premia.

Heavy pressure on energy prices has persisted since the United States (US) midterm election results handed Democrats victories in both the House and the Senate. Expectations that Democrats would restrict Washington’s funding for further military action against Iran have also strengthened hopes of a US-Iran agreement.

The Hill reported that Senate Minority Leader Chuck Schumer (D-N.Y.) said last week: “We are going to end the war. We have some Republicans already who have joined us in ending the war, and the Founding Fathers had the power of the purse as one of the ways of deterring a president who does war without the consent of the American people,”

WTI Technical Analysis: Where Are the Key Barriers and Support Levels?

Trading at $84.81 on the daily chart, WTI US Oil retains a bearish near-term bias. Prices remain well below the 20-day Exponential Moving Average (EMA) of $93.36, indicating that overhead trend resistance continues to cap the market following its recent retreat from above $100. The break below the 6 October low of $86.32 has also produced a fresh lower low, reinforcing the bearish outlook.

At 34, the Relative Strength Index (RSI) sits just above oversold territory. This indicates that downward momentum remains intact, although the decline could start to slow if selling pressure subsides.

Any recovery would first encounter key barriers at the 6 October low of $86.32 and $90.00, followed by the 20-day EMA at $93.36 as the ultimate resistance. On the downside, the 28 August high of $83.11 provides key support, followed by the 26 August low of $79.28.

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