After yesterday's sharp uptick, oil prices slightly decreased during Asian trading today; however, traders continue to monitor tensions in the Middle East following new clashes between the US and Iran.

Brent crude oil dropped to $113 per barrel after a significant rise of 5.8% on Monday, while West Texas Intermediate (WTI) oil approached $104. It has been reported that US military forces repelled Iranian attacks, escorting two American-flagged vessels through the Strait of Hormuz, according to US Central Command. An oil terminal in Fujairah, United Arab Emirates, was attacked. This new escalation of hostilities occurred while the US was trying to clear a path through the waterway for stranded vessels, casting doubt on the four-week ceasefire between Washington and Tehran.

The escalation of tensions in the Middle East, a crucial region for global oil supplies, has once again raised concerns about the stability of energy markets. Attacks on maritime transport and oil-related infrastructure traditionally lead to rising prices for "black gold" due to the risk of supply disruptions. The sharp price increase on Monday reflected this concern among investors, although the subsequent decline may indicate attempts to calm markets and suggest that US military actions ensured safe passage through the Strait of Hormuz.

Let's remember that the Strait of Hormuz is a critical maritime route through which a significant portion of global oil shipments passed until February of this year.

The attack on the oil terminal in Fujairah, one of the world's largest oil transshipment ports, adds yet another layer of uncertainty. Such incidents not only directly affect production and export volumes but also heighten geopolitical risks, undermining investor and consumer confidence. The actions of the US to repel Iranian attacks and ensure vessel passage, along with calls for de-escalation, will be crucial for stabilizing the situation in the near future.

All this suggests that the four-week ceasefire between Washington and Tehran, which many had hoped for, is now at risk. The resumption of hostilities, even on a limited scale, could complicate further dialogue between the parties and the achievement of a peace agreement, leading to another round of rising energy prices.

Regarding the current technical picture of oil, buyers need to reclaim the nearest resistance at $106.83. This will allow them to target $113.00, above which it will be quite challenging to break. The furthest target will be around $118.80. In the case of a decline in oil prices, bears will attempt to take control of $100.40. If successful, breaking this range will deal a serious blow to the bulls' positions and push oil down to a low of $92.50, with the prospect of a further decline to $86.67.