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Moneta Markets

Middle East Tensions Drive Oil Higher, Weigh on FX | 24th March, 2026

Lift Oil, Hit FX

Global markets are turning increasingly risk-off as escalating tensions in the Middle East drive a surge in oil prices and weigh broadly on major currencies. Crude oil has climbed back above the mid-$90 range amid growing supply concerns, reinforcing inflation risks and supporting safe-haven demand for the US Dollar. This environment is pressuring risk-sensitive and major currencies alike, with the Australian Dollar underperforming, while the Pound, Euro, and Canadian Dollar also face downside pressure. As geopolitical uncertainty intensifies, markets are once again being driven by energy dynamics and defensive positioning.

WTI Crude Oil Forecast

Current Price and Context

WTI crude rebounds above the mid-$90 level as escalating Middle East tensions raise concerns over potential supply disruptions. The move reflects a renewed geopolitical risk premium in energy markets.

Key Drivers

  • Geopolitical Risks: Rising tensions increase fears of disrupted oil supply routes.

  • US Economic Data: Stable demand outlook supports elevated energy prices.

  • FOMC Outcome: Higher oil prices may reinforce inflation concerns, impacting Fed policy expectations.

  • Trade Policy: Global instability may disrupt supply chains and energy flows.

  • Monetary Policy: Inflation pressures linked to energy may support tighter policy expectations.

Technical Outlook

  • Trend: Bullish recovery.

  • Resistance: $98.00

  • Support: $92.50

  • Forecast: Oil may continue to rise if geopolitical tensions escalate further.

Sentiment and Catalysts

  • Market Sentiment: Bullish due to supply fears.

  • Catalysts: Middle East developments, inventory data, geopolitical headlines.

AUD/USD Forecast

Current Price and Context

The Australian Dollar underperforms as escalating geopolitical tensions reduce appetite for risk-sensitive currencies. The pair reflects broad USD strength and risk-off sentiment.

Key Drivers

  • Geopolitical Risks: Rising tensions drive investors away from risk currencies like AUD.

  • US Economic Data: Strong USD demand pressures the pair.

  • FOMC Outcome: Hawkish Fed expectations support the Dollar.

  • Trade Policy: Global uncertainty weighs on commodity-linked currencies.

  • Monetary Policy: RBA outlook remains secondary to global risk sentiment.

Technical Outlook

  • Trend: Bearish continuation.

  • Resistance: 0.7050

  • Support: 0.6880

  • Forecast: AUD/USD may continue to weaken under risk-off conditions.

Sentiment and Catalysts

  • Market Sentiment: Bearish.

  • Catalysts: Geopolitical headlines, US data, risk sentiment.

GBP/USD Forecast

Current Price and Context

Pound Sterling declines as geopolitical tensions intensify, driving demand for the US Dollar. The pair reflects a broader shift toward safe-haven positioning.

Key Drivers

  • Geopolitical Risks: Rising tensions boost demand for safe-haven USD.

  • US Economic Data: Strong macro data supports Dollar resilience.

  • FOMC Outcome: Hawkish Fed stance reinforces USD strength.

  • Trade Policy: Global uncertainty weighs on European currencies.

  • Monetary Policy: BoE outlook remains secondary to USD dominance.

Technical Outlook

  • Trend: Bearish bias.

  • Resistance: 1.2700

  • Support: 1.2500

  • Forecast: GBP/USD may remain under pressure if USD strength persists.

Sentiment and Catalysts

  • Market Sentiment: Bearish Sterling outlook.

  • Catalysts: Geopolitical developments, US data, UK macro releases.

USD/CAD Forecast

Current Price and Context

The Canadian Dollar softens despite rising oil prices, as broader USD strength dominates market flows. The pair reflects conflicting forces between oil support and Dollar demand.

Key Drivers

  • Geopolitical Risks: Rising tensions support oil but also boost USD demand.

  • US Economic Data: Strong US data reinforces Dollar strength.

  • FOMC Outcome: Hawkish Fed outlook favors USD positioning.

  • Trade Policy: Global instability affects commodity-linked currencies.

  • Monetary Policy: Oil support for CAD is offset by USD strength.

Technical Outlook

  • Trend: Sideways with bullish USD bias.

  • Resistance: 1.3750

  • Support: 1.3580

  • Forecast: USD/CAD may remain supported if USD strength outweighs oil gains.

Sentiment and Catalysts

  • Market Sentiment: Mixed but USD-favored.

  • Catalysts: Oil prices, geopolitical news, US macro data.

EUR/USD Forecast

Current Price and Context

EUR/USD slips below the 1.1600 level as escalating geopolitical tensions drive demand for the US Dollar. The pair reflects broad USD strength rather than specific Euro weakness.

Key Drivers

  • Geopolitical Risks: Rising tensions increase safe-haven demand for USD.

  • US Economic Data: Strong data supports Dollar resilience.

  • FOMC Outcome: Hawkish Fed stance reinforces USD strength.

  • Trade Policy: Global uncertainty impacts Eurozone sentiment.

  • Monetary Policy: ECB-Fed divergence continues to weigh on EUR.

Technical Outlook

  • Trend: Bearish continuation.

  • Resistance: 1.1680

  • Support: 1.1500

  • Forecast: EUR/USD may remain under pressure amid strong USD demand.

Sentiment and Catalysts

  • Market Sentiment: Bearish Euro bias.

  • Catalysts: Geopolitical developments, US data, ECB signals.

Wrap-Up

Overall, markets continue to trade selectively as investors balance supply dynamics in energy markets with uncertainty around fiscal policy, geopolitics, and central bank guidance. With volatility likely to remain elevated, near-term direction across commodities and currencies will depend on incoming macro data, policy developments, and shifts in risk sentiment.

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