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- Daily Energy Market Update August 5, 2026
Energy markets remained highly volatile overnight as traders weighed growing optimism over a potential agreement to reopen the Strait of Hormuz against renewed security threats in the Red Sea.
President Donald Trump said a deal to restore shipping through the Strait of Hormuz could be reached "tomorrow or the next day," adding that negotiations with Iran are progressing. Multiple reports indicate the U.S., Iran, and Oman are discussing a 60-day shipping arrangement that would establish designated transit lanes through the Strait, raising hopes that the world's most important oil shipping choke point could begin returning to normal operations.
Despite the diplomatic progress, geopolitical risks remain elevated. Yemen's Houthi rebels threatened to target Saudi oil tankers operating in the northern Red Sea, prompting crude oil to recover from overnight losses and pushing Brent back above $80 per barrel. The renewed threat serves as a reminder that even if traffic through the Strait of Hormuz improves, risks to regional energy infrastructure and shipping have not disappeared.
The market continues to balance these competing headlines. Optimism surrounding a Hormuz agreement has reduced some of the geopolitical risk premium, while renewed threats in the Red Sea are helping limit the downside in oil prices. Traders will remain focused on any official announcement regarding the proposed shipping agreement and any further developments affecting maritime security in the region.
Crude (Cont. Contract)
Crude is up 0.68 this morning, trading at 76.44 as of 6:34 AM, following yesterday's sharp decline.
Yesterday's close finished below the 200-day moving average, which comes in at 76.35, marking a significant technical break. This morning's bounce has stalled near the 200-day moving average, making it a key level to watch on today's close. A failure to reclaim the 200-day moving average would suggest yesterday's breakdown remains intact and could lead to additional downside pressure.
Momentum has moved back into neutral territory but continues to point lower, indicating downside momentum has eased but has not yet reversed.
Key Levels
Resistance
81.04 – 50-day moving average
81.28 – 20-day moving average
89.84 – 100-day moving average
Support
71.03 – Lower Bollinger Band
67.04 – Reversal bar low from July 2
Crude (Cont. Contract)
Heating Oil (HOU6)
Heating oil opened lower overnight, testing yesterday's low before finding support and rebounding. As of 6:49 AM, it is trading at 3.8051.
The pullback over the past several sessions pushed price below the 20-day moving average, but heating oil continues to hold well above the 50-day and 100-day moving averages. That relative strength compared to crude oil suggests the market remains in a stronger technical position despite the recent correction.
Momentum remains in overbought territory but continues to point lower, indicating rallies are likely to encounter selling pressure until momentum moves back toward neutral.
Key Levels
Resistance
3.9309 – 20-day moving average
4.2888 – July 23 high
4.3376 – Upper Bollinger Band
Support
3.5604 – 50-day moving average
3.5240 – Lower Bollinger Band
3.4573 – 100-day moving average
Heating Oil (HOU6)
Crude Spread (CLZ6/CLZ7)
The spread is up 0.40 this morning, trading at 4.77 as of 7:03 AM.
The spread made a new low for the move overnight before finding support and rebounding. It is now trading near the overnight high. A close back above 4.37 would form a bullish reversal, suggesting selling pressure may be beginning to fade after the recent decline.
Momentum has moved out of overbought territory but continues to point lower. While downside momentum is easing, there is still room for momentum to move toward neutral, suggesting stronger rallies may continue to face selling pressure.
Key Levels
Resistance
5.42 – 50-day moving average
5.96 – 100-day moving average
6.34 – 20-day moving average
Support
3.00 – 200-day moving average and lower Bollinger Band
1.38 – Low from July 2
Crude Spread (CLZ6/CLZ7)
Natural Gas Market Overview
Natural Gas (NGU26)
Natural gas is opening modestly higher, up 0.014 at 2.695.
Price tested the lower end of the recent trading range overnight and has held that support so far. Today marks the sixth consecutive session of consolidation following last week's breakdown, with the market continuing to trade in a narrow range. A move above 2.810 or below 2.659 would signal a breakout from the current consolidation and likely determine the next directional move.
Momentum remains oversold and is now pointing sideways, reflecting the current indecision in the market. Until price breaks out of its recent range, the technical picture remains neutral.
Key Levels
Resistance
2.810 – Top of the recent trading range
2.821 – 20-day moving average
2.980 – Upper Bollinger Band
Support
2.660 – Lower Bollinger Band
2.659 – Bottom of the recent trading range
Natural Gas (NGU26)
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Disclaimer
This article and its contents are provided for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any commodity, futures contract, option contract, or other transaction. Although any statements of fact have been obtained from and are based on sources that the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed.
Commodity trading involves risks, and you should fully understand those risks prior to trading. Liquidity Energy LLC and its affiliates assume no liability for the use of any information contained herein. Neither the information nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts. Information contained herein was obtained from sources believed to be reliable, but is not guaranteed as to its accuracy. Any opinions expressed herein are subject to change without notice, are that of the individual, and not necessarily the opinion of Liquidity Energy LLC
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