Snapshot: Brent crude has plunged below $78 per barrel to its lowest level since March, driven by a breakthrough interim US-Iran agreement that is reopening the Strait of Hormuz and unlocking halted Persian Gulf supply. This structural flow normalization easily eclipses tight onshore inventories, where Cushing sits at 20 million barrels and the US Strategic Petroleum Reserve has hit its lowest level since 1983. We look to the 08:30 ET US macro data for the next demand-side cue.
- The clean technical break below $78.00 invalidates the medium-term bull case, leaving the market highly vulnerable to further capitulation despite the 10Y real yield slipping to 2.14% and a softer US dollar.
- Keep a close eye on the 08:30 ET Philly Fed and Unemployment Claims; any macro weakness will accelerate liquidations, though shipping friction in Hormuz remains a key upside risk.
Bias into NY: We hold a high-conviction bearish bias, targeting a run to $76.50 as regional exports resume, with any USD weakness following yesterday’s FOMC projections acting only as a minor speed bump for sellers.