Brent oil has completely lost its war premium. On Wednesday, the price dropped to around $72.25 per barrel. From the March peak of about $120, the market has fallen nearly 40% and returned to where it was trading before the conflict began.
Pressure increased after talks between Iran and the U.S. reached a deadlock. But traders are now less focused on the risk of escalation and are once again evaluating familiar factors: demand, supply, and the state of the global economy.
Brent Is Back Inside a Multiyear Downward Channel
The weekly chart shows that since the end of 2023, Brent has been moving within a downward parallel channel. This channel has long set the main range for the market.
In 2024 and early 2026, the upper boundary of the channel stopped growth several times. After each attempt to break higher, the price returned to the middle of the range.
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The situation changed after the escalation between Iran and the U.S.. While the Doha talks yielded no results, the market began to price in the risk of supply disruptions. Brent broke out of the channel, quickly rose to the $104–114 area, and at its peak almost reached $120.
UKOIL weekly chart. Source: TradingView.
Now this jump has been fully reversed. From its high, Brent has lost about 40% and returned to the $60–72 zone, where accumulation previously formed.
The upper boundary of the old channel now runs just below the price. If buyers hold this level, the market may try to stabilize. But if support fails, pressure on oil will increase again, and the price may fall deeper into the previous range.
The Daily Chart Looks Weaker
On the higher time frame, Brent still has a chance to hold support, but the daily chart looks much heavier. The short-term momentum is clearly on the sellers’ side.
After the March high, Brent formed a symmetrical triangle. The price gradually squeezed between falling highs and rising lows, with the key area around $108.
At the end of May, the pattern broke down. After the breakout, oil began to fall sharply because the market was no longer as afraid of supply problems through the Strait of Hormuz.
UKOIL daily chart. Source: TradingView.
The price is now again in the $68–73 zone. In January and February, even before the conflict, this range already acted as support.
RSI on the daily chart has dropped below 30. This is the first such oversold condition since April 2025. On the one hand, this confirms strong selling pressure. On the other, after such moves the market often pauses or tries to rebound.
The Oil Outlook Depends on the $68–72 Zone
Right now, everything for Brent comes down to the $68–72 range. Several levels coincide here: the upper boundary of the weekly channel, daily support, and the upward line from the year’s early lows.
The price is holding at the upper part of this zone, around $72.25. At the same time, the target for the drop after the triangle breakout has almost been reached. The width of the pattern was about $29, and the breakout happened near $100, giving a target of about $71.
If Brent holds above current support, the prewar base will remain intact. The market could then try to recover to $80, from where the price collapsed in June. A daily close above this mark will ease selling pressure.
A break below $68 would be a different signal. In that case, the next important zone is around $60. That is the lower part of the accumulation area, and below it lies the lower boundary of the long-term channel.
Fundamentally, the situation remains ambiguous for now. Falling oil inventories in the U.S. and supply risks are supporting the price. But the decline in the war premium and the new license for Iranian oil exports are preventing Brent from mounting a strong rebound.
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Going forward, everything will depend on news from the Middle East and the balance of supply and demand. If geopolitical risk rises again, oil may hold its current zone. If the market continues to ignore the war premium, Brent risks moving closer to $60.
An additional factor for the market in the coming weeks will be the behavior of major oil consumers. Any signs of a slowdown in the global economy may again increase pressure on prices, especially if supply from producers continues to rise at the same time. At the same time, seasonal growth in fuel demand in some countries may temporarily support prices and prevent Brent from quickly falling below current levels.
Investors are also closely watching the actions of OPEC+ and production trends in the U.S.. If the largest producers decide to limit supplies or oil inventories continue to fall, this could change market sentiment and bring buyers back. However, for now, market participants prefer to take a cautious stance and are in no hurry to price in a new round of growth.
From a technical perspective, the coming weeks could be decisive. Holding the $68–72 range will allow the market to form a new base and try to recover some losses. Otherwise, sellers will gain another argument for a deeper decline, and market participants’ attention will shift to the area around $60 per barrel, which could become the next major target for Brent.
