WTI crude oil price forecast: Oil explodes above $73 as Hormuz risk premium returns

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WTI crude oil price surge

Highlights

WTI surged over 9% to trade above $73, highest in eight months.
Price broke decisively above $68 resistance and cleared all major EMAs.
Strait of Hormuz risk now outweighs incremental OPEC+ supply increases.

This price movement indicates more than just typical market fluctuations. Approximately 20% of global oil shipments transit through the Strait of Hormuz, meaning any escalation involving Iran poses a direct threat to global supply chains. Iran's recent missile activities have heightened uncertainty, leading refiners and shipping companies to prepare for possible transit disruptions.

Although OPEC+ plans to raise production by 206,000 barrels per day in April, this increase seems minimal when considering the magnitude of possible chokepoint risks. Markets are responding less to the gradual changes in production policy and more to the likelihood, however unlikely, of disrupted supply flows.

In effect, crude is trading a geopolitical premium rather than a conventional supply-demand balance. Even absent physical disruption, the mere threat of constrained passage through Hormuz forces traders to hedge exposure.

Technical breakout confirms bullish shift

The daily chart confirms the shift in trend. WTI settled near $72.95 after touching an intraday high above $75. The rally pushed decisively through the February swing high in the $67 to $68 zone and advanced well beyond the 20-day EMA at $65.36, the 50-day at $62.95, and the 200-day near $63. Crude now trades roughly $10 above its long-term average, reflecting strong upside momentum and firm bullish control in the near term.

WTI price dynamics (Source: TradingView)

Since bottoming near $55 in January, crude has formed a sequence of higher lows and higher highs. The consolidation under $68 served as a compression zone, and Monday’s wide-range breakout resolved that structure decisively to the upside.

RSI is close to 75, which means that the market is overbought. But in markets that are driven by headlines, high RSI can last as long as there is still geopolitical tension. There is immediate resistance around $75. If it stays above that level, the $78 to $80 area, which used to be a weekly supply zone, would be open. The first support level has moved to the old resistance band, which is between $68 and $69.

As previously discussed, WTI had been building a constructive base above its EMAs before headlines accelerated the move. With price now firmly above the EMA cluster, the technical structure aligns with the geopolitical backdrop.

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