Brent crude stabilizes amid geopolitical shifts and fundamental headwinds

On Friday, Brent crude stabilized near $65 per barrel, pairing earlier losses. This shift came as geopolitical tensions eased following the Israel-Hamas ceasefire agreement, prompting investors to unwind the risk premium built up over the two-year clash. However, price declines were capped by new US sanctions targeting Iranian oil.

According to fundamental analysis, current quotes reflect a much lower probability of supply disruptions from the region. Although America has imposed new restrictions on entities involved in the Iranian fuel trade, their impact is set to be limited and slow to materialize. Meanwhile, the market continues to face pressure from ample supply, driven by rising production from OPEC+ countries and record US output of 13.53 million barrels per day.

Under these conditions, a strengthening dollar or signs of China's faltering economic growth could exert additional pressure on prices. If current dynamics persist, the most likely scenario is a sideways trend between $64.00 and $66.00. Nevertheless, the underlying trend remains bearish, fueled by seasonal demand fragility and mounting inventories.

The technical picture aligns with this fundamental background. After a recent rebound from the key $64.00 level, the market is entering a weakening phase. The earlier rally appears to be a corrective pullback within a broader bearish trend. The indicators' behavior corroborates this. The Stochastic (5, 3, 3) is turning down from the neutral zone, meaning there will be more selling. Concurrently, the Chaikin Oscillator, still in the red, is speeding up its drop, signaling a lack of sustained buying interest. The market is likely to enter a consolidation phase as long as the bulls can hold the $64.00 support.

Take into account the trading plan down below:

Sell Brent crude at the current price. Take profit: $62.90. Stop loss: $67.00.

This forecast is valid from October 10 to October 17, 2025.