Against this backdrop, oil prices have remained volatile, driven more by risk premiums than by traditional demand-supply fundamentals.
According to Ross Maxwell, Global Strategy Operations Lead at VT Markets, crude oil is expected to remain range-bound, with sharp volatility spikes triggered by headlines. Slowing global growth may cap the upside, while geopolitical turmoil provides a floor, making oil a tactical, not linear, investment opportunity.
He notes that oil may not deliver consistent returns, but can offer resilience and diversification during periods of stress.
Manoj Kumar Jain of Prithvifinmart Commodity Research echoes this outlook, stating that recent geopolitical developments, such as the capture of the Venezuelan President, new trade sanctions against Iran, and ongoing tensions between Russia and Ukraine, have kept crude oil prices volatile, though they may trade with a “positive bias”.
Jain expects WTI crude to test levels between $68 and $74 per barrel, with $54 acting as a strong support on the lower end. In the domestic market, he sees MCX crude consolidating in the range of Rs 5,000 to Rs 5,400, with Rs 4,980 serving as a critical support zone.
Data from 2025 reveals that crude oil closed the year with a sharp decline of over 15% in Indian markets, one of the worst performances among non-agricultural commodities. Despite this, Jain remains optimistic about a technical base forming in the first half of 2026, supported by the potential revival of global demand, easing trade tariffs, and accommodative US monetary policy.
What should investors do now?
In light of these dynamics, Ross Maxwell recommends that investors avoid direct exposure to crude as a commodity and instead consider well-managed energy equities, such as refiners and integrated oil producers.
These companies typically exhibit lower sensitivity to crude price swings, benefiting from strong cash flows and disciplined capital allocation, which can support dividend generation.
Energy stocks can also serve as a partial hedge against inflation and global shocks, thus enhancing portfolio resilience.
Jain, too, suggests a cautious but opportunistic approach.
He advises a staggered buying strategy in domestic markets within the price range of Rs 5,050 to Rs 4,900, with a stop loss at Rs 4,640. His target range for MCX crude stands between Rs 5,700 and Rs 6,000, indicating room for short- to medium-term gains if current support levels hold.
Ultimately, both analysts agree that crude oil should be treated as a tactical play within a diversified portfolio, providing ballast during volatile times rather than forming the core of an investment strategy. Selectivity, discipline, and a strong understanding of global cues remain key to navigating this complex energy landscape.
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(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)