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Global oil prices surged toward $120 per barrel as tensions in the Middle East escalated, particularly around the Strait of Hormuz, raising fears of a prolonged supply disruption. However, prices paused their upward momentum as markets anticipated a coordinated release of strategic reserves by the G7 and the International Energy Agency (IEA) to stabilize energy markets. The move aims to counterbalance geopolitical risks and ease inflationary pressures, though uncertainty remains about the scale and timing of the intervention. For traders, the situation highlights the delicate balance between geopolitical risks and central bank policies. Energy markets are highly sensitive to supply shocks, and any large-scale reserve release could temporarily depress prices, impacting both producers and consumers. Meanwhile, investors in energy equities and commodities must monitor how OPEC+ responds to the G7's actions, as divergent strategies could create volatility. The key focus now shifts to the IEA's official announcement and subsequent market reactions. For Gulf investors, the outcome will influence regional energy exports and domestic inflation. If the reserve release proves insufficient, prices may rebound sharply, while a successful intervention could signal a shift toward more aggressive supply management. Traders should also watch for technical resistance levels near $120 for Brent crude.
