Brent Crude Nears $116 On Record Monthly Surge, But Charts Show Fatigue

(MENAFN- The Rio Times) Key Points

- Brent crude hit $115.77 on Monday, up 2.8% on the day and approximately 60% for March - on track for its largest monthly gain since LSEG records began in 1988, surpassing the September 1990 Gulf War spike of 46%

- Yemen's Houthis launched their first direct attack on Israel, opening a new front in the conflict - while Israel continued strikes on Iranian infrastructure in Tehran and Trump threatened to destroy Iran's oil wells and Kharg Island

- However, the technical picture tells a different story: Brent has tested the $118–$119 resistance three times without closing above it, the MACD histogram has turned negative for the first time since the rally began, and Goldman Sachs estimates $14–$18 per barrel in geopolitical premium that would evaporate if the Strait of Hormuz reopens

The Brent crude oil price surged to $115.77 per barrel on Monday morning, extending a rally that has rewritten the record books for monthly gains. The Rio Times, the Latin American financial news outlet, reports that crude is up approximately 60% in March alone - surpassing the 46% surge during the 1990 Gulf War to become the largest monthly increase in the 38-year history of LSEG data. WTI advanced to $101.51, up 52% for the month and its best performance since May 2020.

The immediate catalyst was the Houthis' first direct missile attack on Israel from Yemen, which opened a new theater in the US-Israel-Iran conflict and raised fears that the Bab el-Mandeb Strait - the Red Sea chokepoint - could join the Strait of Hormuz as a contested shipping lane. Israel continued strikes on Iranian government infrastructure in Tehran on Monday.

The Escalation That Keeps Escalating

Vandana Hari of Vanda Insights said the market has "practically ruled out a negotiated resolution" despite Trump 's claims of "direct and indirect" contacts with Tehran. Iran's Foreign Minister Araghchi stated explicitly that "no negotiations have happened with the enemy until now, and we do not plan on any negotiations" - contradicting the White House narrative.

Trump's temporary suspension of strikes on Iran's energy grid until April 6 provided only fleeting relief. SEB Research noted that investors now demand "concrete signals of de-escalation beyond rhetoric." The Strait of Hormuz has been effectively closed to commercial traffic since early March, disrupting approximately 17.8 million barrels per day of oil flows - roughly 21% of global supply.

The Technical Case for a Reversal

Beneath the geopolitical headlines, the daily chart is flashing a warning. Brent has tested the $118–$119 resistance zone three times during March - hitting $118.19 intraday at the month's high - and failed to close above it on each attempt, with Monday's session opening at $111.30 and closing at $110.71, well below the rejection zone. In classical technical analysis, a triple top failure at resistance is one of the most reliable exhaustion signals.

The MACD histogram has turned negative at -0.11, with the signal lines at 8.40 and 8.51 beginning a bearish crossover - the first since the rally began in early March. The RSI reads 73.76 on the fast line and 68.43 on the slow, both declining from the heavily overbought zone above 80 hit earlier in the month - a pattern of negative divergence where price makes new highs but momentum fails to confirm.

The price sits roughly 37% above the EMA50 at $80.61 and 60% above the 200-day moving average at $69.11 - an extreme extension that historically does not sustain without a pullback to at least the first intermediate support levels at $99–$101. Goldman Sachs estimates $14–$18 per barrel in geopolitical premium baked into current prices, and the EIA forecasts Brent falling below $80 by Q3 if the conflict resolves.

What to Watch

The April 6 deadline - when Trump's suspension of strikes on Iran's energy infrastructure expires - is the next binary event. A resumption of attacks on refineries and export facilities could push Brent toward or above its 2008 all-time high of $147, while any credible de-escalation signal would trigger the sharpest single-day decline in years as the war premium unwinds.

For Latin American economies, the stakes are asymmetric. Oil exporters like Brazil, Colombia, Ecuador, and Venezuela benefit from elevated prices, while net importers across Central America and the Caribbean face a direct inflation shock. The triple rejection at $118 suggests the market is pricing in the worst-case scenario but struggling to commit further capital above that level - a setup that, combined with a MACD bearish crossover and RSI divergence, historically resolves to the downside more often than it breaks higher.

MENAFN30032026007421016031ID1110920306