Oil prices are on the rise lately, bringing a major headache to central bankers and market participants. The WTI crude oil price is now at $94.50, and it feels like there is nothing on the way to $100.

But every $1 higher in oil prices is a major headache for everyone involved in financial markets. First, the price of oil has direct links to inflation. Eventually, it all translates into higher prices of goods and services.

The decline from $120 to $70 was cheered by central bankers. Indeed, inflation came down, albeit not enough, to reach the central banks’ target of 2%.

Second, the world is in an energy crisis amplified by the race towards green energy and the new geopolitical alliances forming as a result of Russia’s invasion of Ukraine. Europe is a top energy importer, and the common currency, the euro, is one of the weakest on the FX dashboard during the current rally in oil prices.

In the last three months only, oil prices are up 38%. That is, 35% above the price the US wanted to replenish its Strategic Petroleum Reserve. Imagine if they did, where prices would have been.

At the same time, stocks are on their knees, as a sign of a recession that might be due. However, higher oil prices indicate no recession at all.

Finally, house prices are rising like central banks ease monetary conditions, not vice versa.

Having said all that, what does the technical picture for the WTI crude oil price looks like?

After trading above $120 in 2022, the WTI crude oil price started a slow descending trend. It reached support in the $70 area, where it consolidated for a while.

A triangular pattern broke higher as support held. On its move higher, the WTI crude oil price already reached the triangle’s measured move.

Moreover, there is no resistance until the pivotal $100 level.

So, are we to see oil trading above $100 again? If the US decides to replenish its SPR levels at current prices, and the oil production remains unchanged, $100 would be just a milestone towards higher levels.

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