Crude oil prices jumped over 15% early on Monday amid the attack on a Saudi Arabian production facility over the weekend. Brent rose above $68 and then retreated partially but remains elevated as traders assess the damage for global oil supplies which declined by over 5% after the attack was on the world's biggest petroleum-processing facility.
Meanwhile, Trump said on Sunday said that the US would be tapping into its strategic petroleum reserve if needed in the wake of attacks on oil sites in Saudi Arabia. Also, Russian Energy Minister Alexander Novak highlighted that there are enough stockpiles to cover shortfall from Saudi Arabia. These comments have somehow played down the impact of the attacks on Saudi oil facilities.
Nevertheless, the bullish sentiment in the market will likely persist in the market in the short term as traders have now realized that oil infrastructure is highly vulnerable to attacks, and the market didn’t price in this factor before. The initial support for Brent now lies around $66, while a more important area for bulls comes at $64, where the 100- and 200-DMAs have settled.