Brent Crude Eyes Rebound Amid Escalating Middle East Tensions

Crude oil prices took a hit last week despite escalating tensions in the Middle East. The Houthi attacks on Saudi Arabia's oil infrastructure, particularly around Riyadh Airport, have raised concerns about supply disruptions. This comes as traffic through the Strait of Hormuz remains significantly lower than pre-war levels.

The situation is further complicated by Russia and Ukraine's intensifying attacks on key energy infrastructure. As a result, oil supply is expected to remain under pressure in the coming weeks or months.

However, some analysts believe that Brent crude could rebound as it has formed a break-and-retest pattern, remaining above its 50- and 100-day Exponential Moving Average (EMA). If this trend continues, oil prices may rise to $110 and potentially even $120.

In the US, the average gasoline price has jumped to $4.4, while diesel has reached a record high. This disconnect between crude oil prices and refined products suggests that diesel will likely outperform crude as refiners struggle to balance yields.