US dollar and oil chasing $80 are in focus for investors this week | Financial Times

US dollar and oil chasing $80 are in focus for investors this week | Financial Times:

The oil market is suffering from altitude sickness. While the fundamentals of the market increasingly point to higher prices in the short term, with the International Energy Agency this week warning of a possible supply crunch once the US reimposes sanctions against Iran’s oil industry in November, Brent crude continues to struggle to break out of its well-defined $70-$80 a barrel trading range.

On Wednesday bullish traders briefly pierced the $80 a barrel level, getting within 50 cents of the high for the year. But rather than marching higher prices beat a quick retreat, like mountain climbers spooked by the effects of a lack of oxygen when scaling a Himalayan peak.

So what, if anything, can break the range that has been in place since April? Well the reasons for caution at the $80 a barrel level are multiple. That price level was one of the triggers back in May for US president Donald Trump to push Saudi Arabia and other major oil producers to add more supply to the market, partly to compensate for the looming loss of Iranian barrels. Further oil-related Tweets from the White House cannot be ruled out ahead of midterm elections in two months time.