It's now that everything is at stake!
For the price of oil...
Between riposte... riposte of the riposte... then riposte of the riposte of the riposte... between Israel and Iran, the price of a barrel of oil did a yo-yo intraday, rising then immediately falling from the Confirmations of response were more about intimidation than anything else.
To refresh our memory, on April 1st we had the pulverization of the Iranian consulate in Damascus which was interpreted (rightly) as a direct attack by Israel on Iranian soil, embassies and consulates abroad being considered as territory of the country represented.
Iran swears revenge... the country openly warns Israel and all its allies of its imminent attack directly on Hebrew territory planned for April 13. Sending 170 Shaheed drones (the lowest cost on the market) plus a few ballistic missiles, all were intercepted, no damage.
In short, we could have left it there... but Israel would like to clear this front... says that they will respond... the USA openly warns that they would not condone any other attack by the Hebrew state on Iran...
But hey... be careful, we still have to clear this affront... so the Israeli army sends... stay seated... 3 dones in retaliation on the night of Thursday April 18 to Friday April 19.
Consequences, the oil market jumped $4 at the announcement of Israel's retaliation against Iran, only to fall immediately in the early morning when the scale of the attack was publicized... 3 drones, that's really the gesture that counts and just to have the last word... or... to observe the Iranian air defenses... but hey with 3 drones, I don't know if the Israelis were able to see much... . Only the future will tell us.
The shape of the April 19 candle tells us a lot about the reaction of oil traders to the announcement of Israeli retaliation on Iran.
In the heat it was purchases or even short covers in hedge...
Then when we really knew the intensity of Israel's attack on Iran, traders spontaneously abandoned their long positions and removed their hedging covers, causing the oil market to fall instantly.
This is how a doji of indecision was created on Crude oil despite the announcement of Israeli retaliation that day.
On April 19, the weekly RSI for crude was at 0... it was normal to see the price of crude rise because the price of a barrel was oversold.
So NOW what's going on?
Where is the price of Crude oil going?
Well, we could say that Iran and Israel are even... that de-escalation has begun... and that the price of oil will run out of steam.
Bahhhhh... not so sure... because there is a specific deadline that Israel imposes on Hamas... and that is NOW!
The ultimatum is: "Release the hostages now or we enter Rafah to clean up in a few hours."
If the IDF starts entering Rafah... it will be a bloodbath for the population!
The United States has warned that Israel must not cross this Rafah red line... Egypt is threatening to shatter the 1979 Israeli-Egyptian peace treaty and demilitarization of Sinai.
If Israel crosses this limit of passing the city of Rafah... it will be THE break and a diplomatic return very difficult to obtain.
To be able to illustrate this, you need to get a cartographic idea of where Rafah is located...
Rafah is on the Egyptian border. Since the start of the conflict, the Israeli army has forced civilians to migrate to the south of the Gaza Strip to supposedly be protected from the combat zones.
Gaza is just 3x the surface area of Paris, it's very small.
There are currently more than 1.2 million Gazan refugees there, who are supposed to receive humanitarian aid and be safe there.
A security perimeter was even decreed there.
If the IDF enters this perimeter, it will be a real butchery and a good part of the world already considers Israeli operations in the Gaza Strip as a genocide of the Palestinian population.
For 48 hours, the armored vehicles of the Israeli army have been deployed and piled up at the gates of Rafah... tents were set up there in order to potentially accommodate Palestinian refugees who would have to flee the Rafah area...
Everything was set up for an imminent entry of the IDF into Rafah.
If Israel crosses this red line... oil prices will react much differently than previous "retaliatory" attacks on Iran.
Egyptian and Qatari negotiators were urgently dispatched to resolve this ultimatum as quickly as possible and succeed in obtaining a truce with the release of hostages.
Now, two scenarios are possible:
The negotiations are successful, the hostages are released and the IDF withdraws from the Gaza Strip.
The IDF enters Rafah to clean up and exterminate the slightest potential terrorist that moves.
2 scenarios for 2 opposite directions of the price of the barrel!
In the first version, the barrel will fall severely because the economies are slowing down, the PMIs are falling, inflation is rising, US oil reserves are increasing at high speed and above all Powell will surely tell us on Wednesday that the key rate of the FED will remain elevated for a good while before beginning its descent.
In the second version, the barrel will explode even if only temporarily, Egypt will break the peace agreements with Israel, global tensions around this conflict will exacerbate (there is already trouble on the ground American pro-Palestine academics who make their voices heard and must be dislodged by the police) the Americans risk turning away more and more from the support they give almost blindly to the Israelis. And if Israel loses the USA... it will be the beginning of the end. Embargoes against Israel will begin to rain down, like that of Turkey very recently.
And above all... the ICC (International Criminal Court) risks issuing an international arrest warrant against Benyamin Netanyahu as well as his Minister of Defense and his Chief of Staff for war crimes! If Karim Khan, the Attorney General of the Court, issues this international judgment, this will amount to putting them on the same level of “pariahs” as Vladimir Putin has been placed since March 2023.
In short, it is now that the direction of the price of crude oil will be decided...
Stay vigilant, things can go haywire very quickly, in one direction or the other!
Comments