The recent volatility in the Middle East situation has really thrown the crude oil market into chaos. I took a look at the recent market movements, and in just a few days, the price swings have been ridiculously large.

What happened in mid-April? On the 17th, crude oil prices plummeted by 10%, with WTI briefly dropping below $80 per barrel. But by the open on the 20th, there was a major reversal, with WTI rising 4.17% to $87.49 per barrel, and Brent increasing 3.37% to $95.52 per barrel. The reasons behind this rollercoaster are actually quite complex.

At its core, it’s still the ongoing back-and-forth between the U.S. and Iran. Iran initially announced it would open the Strait of Hormuz, then reversed course and closed it again. The U.S. has also been seizing Iranian ships, and Trump even threatened to destroy Iran’s infrastructure. The two-week ceasefire agreement is set to expire on April 22, and whether it will be extended remains uncertain. Iran is even hesitating on whether to participate in a new round of negotiations.

From an analyst’s perspective, this is indeed a big problem. CBA analysts pointed out that the worsening situation at the Strait of Hormuz directly threatens U.S.-Iran peace talks. It’s important to note that the U.S. naval blockade affects the transportation of 3.8 million barrels of crude oil and refined products daily—goods that previously passed through the Strait of Hormuz. If Iran’s ships continue to be intercepted by the U.S., Iran is likely to retaliate by banning all ships from passing, which could truly break the oil supply chain.

So, what will happen to crude oil prices next? From a technical standpoint, since prices failed to break through the resistance level at $91.17, they might retreat in the short term to the $84–86 range. If prices do break above $91.17, they could rise to the $94–95 range. But the overall trend remains bearish, with some analysts suggesting WTI crude could resume a decline, with a target around $77.

This situation really depends on how things develop, as the Middle East remains highly unpredictable.