Oil Price Analysis 2026 May

WTI crude futures fell below the $93 per barrel mark this morning, marking a sharp extension of yesterday’s sell-off. Market is now in between geopolitical risks and potential diplomatic solution.

1. We Have Peace Deal on the Table

The primary reason oil price fell is US memorandum of understanding (MoU), aimed at de-escalating the conflict with Tehran and reopening the Strait of Hormuz.

Markets reacted to news sent via Pakistani intermediaries, which could lead to a formal end of war.

Iran confirms it is reviewing the proposal, but there is Trump factor, he called the deal a "big assumption" and threatened a continuation of military strikes if compliance isn't met.

Also data confirms that U.S. oil exports reached a record 8.2 million barrels per day last week, suggesting that states are effectively filling the supply gap by reducing the "fear premium" that has kept prices higher.

2. Technical Analysis: Key Levels & Indicators

On H4timeframe WTI is at a critical technical price level, after a sustained period of volatility, the price is testing major support zone (it’s for now a new normal support zone because of war).

• Immediate Support ($90.10 - $90.77): The price is currently resting on 90.77. A break below this could trigger a flush toward the $84.32-86.40 zone.
• Resistance ($96.93): This previous support level, which turned into resistance, if (MoU) successfully passes, price after some upward correction, will begin to decline to 84 and below.

3. Oil Market Outlook

The short-term trajectory of WTI is now almost entirely dependent on Tehran’s response to the US proposal, expected in the coming days.

If Iran rejects the MoU or if military rhetoric from the White House intensifies, expect a rapid reversal back toward the $100+ range. Conversely, a formal acceptance of the reopening terms for the Strait of Hormuz could see WTI target the $84.00 handle as the geopolitical risk premium evaporates.

Trading Sentiment: Bearish momentum is dominant, but the RSI suggests traders should be wary of chasing the move at these levels without a confirmed break of the $90.00 psychological floor.