Brent Crude Oil Analysis: Iran Tensions, OPEC Plus and Price Trends

02/05/2025

2 minutes read

2025.02.05 06:14

Brent Crude oil prices recovered supported by potential “maximum pressure” on Iran by the US.
OPEC+ maintained its current production policy, with a planned gradual increase in supply depending on market conditions.
Technical analysis indicates Brent Crude Oil faced support at the 100-day moving average.
Key support levels for Brent Crude Oil are identified at $76.35, $75.00, and $72.38, while resistance levels are at $77.68, $78.43, and $80.00.

prices slid as much as 2% in European trade as US tariffs on China took effect. Beijing responded with its own actions, raising concerns about a trade war which weighed on oil prices.

prices did however find some support as Trump Trade Advisor Navarro stated that a call between the US-China would take place today. Navarro remained cautious stating that lets see what happens on any China pause which may have stoked some optimism of a similar scenario as the one between the US and neighboring countries Mexico and Canada.

U.S. President Donald Trump is set to issue a directive on Tuesday aimed at reinstating “maximum pressure” on Iran, according to a U.S. official cited by Reuters. This could be another factor contributing to the recovery in Oil prices as such a move could have an impact on global supply as Iran still ships around 1.3 million bpd, mostly to China.

OPEC + Policy Remains Unchanged

OPEC+ held its first meeting of 2025 and decided to keep its production policy unchanged. They plan to gradually add around 2.2 million barrels per day to supply over 18 months starting in April, depending on market conditions. The next meeting is set for April 5.

No surprises on the policy front as uncertainties from potential trade wars continue to linger. The only major shift from OPEC + at the meeting was in regard to data sources, with the group moving away from the IEA and favoring Kpler, OilX and ESAI.

Looking Ahead

Market participants will now turn their attention to the demand side with API for the week ending January 31 due for release later in the day.

The API crude oil inventory data for February 4, 2025, is expected to show an increase of 3.17 million barrels. This is slightly higher than the previous week’s increase of 2.86 million barrels. Upcoming Economic Events

Technical Analysis – Brent Crude

From a technical analysis standpoint, Brent’s slide was stalled as it ran into the 100-day. This saw the price rise to trade around 0.84% higher on the day just shy of the $77/barrel mark at the time of writing.

Brent Crude Oil Daily Chart, February 4, 2025

Source: TradingView

Dropping down to a four-hour chart (H4), the bearish trend is still well and truly intact. There are some signs that bulls may be eyeing further gains with the RSI crossing above the 50 level which is typically a sign of shifting momentum.

Looking at price action and a four-hour candle close above the recent swing high at 77.68 is needed for a change in structure. This could further embolden bulls and push prices back toward the psychological 80.00 a-barrel mark.