HG MARKETS:

Indirect discussions held in Geneva on Thursday aimed to de-escalate tensions following a U.S. military buildup in the Middle East. While regional friction persists, statements from Omani mediators indicating “tangible progress” have calmed the markets. The parties are set to transition to technical-level talks in Vienna next week. This shift is crucial for traders, as any escalation near the Strait of Hormuz—a vital global shipping artery controlled largely by Iran—historically triggers sharp price spikes. The extension of these talks has eased immediate fears of a military confrontation, allowing the market to recalibrate its risk assessment and focus on fundamental supply and demand factors. In a significant shift for global supply dynamics, oil sales under the recent U.S.-Venezuela agreement are projected to reach $2 billion by the end of February. This follows the U.S. assuming control of Venezuela’s oil infrastructure earlier this year after the capture of President Nicolas Maduro.

With global firms like Vitol and Trafigura marketing this crude, major consumers in Europe and Asia, particularly India, are ramping up imports. Venezuela has successfully ramped up domestic production under this new oversight, resulting in a sharp increase in global availability. The re-entry of Venezuelan barrels marks a substantial rise in global output, intensifying fears of a supply glut in 2026 that continues to weigh heavily on crude futures, potentially creating a long-term bearish trend.

Crude Oil prices are being traded in an Equidistant Channel formation in the weekly timeframe, the current price at the time of writing on Friday, Feb 27 at 1130 HRS PKT is $65.63/Barrel and market seems likely to reach the 100 day moving average level of $ $68.50/Barrel.

If this resistance level breaches the next target for bulls can be $70, $71.90 & $75.60/Barrel

However a failure to break this Resistance point can plunge the prices to $61.50/Barrel which if broke may send oil prices to $57.50/Barrel