Bitcoin and the broader crypto market saw a notable price rebound on Friday after major economies announced joint efforts to increase oil supplies across the now-disrupted Strait of Hormuz.
BTC, the largest cryptocurrency, surged to $70,800, up more than 1% on the day, extending its recovery from an overnight low below $68,900, according to CoinDesk data. Other major coins, including ether (ETH), XRP (XRP), and solana (SOL), saw gains of less than 1%, trailing bitcoin.
West Texas Intermediate (WTI) crude fell almost 2% to $93.80, alongside similar losses for Brent, after Britain, France, Germany, Italy, the Netherlands and Japan said they would take steps to stabilize energy markets and join collaborative efforts to ensure safe passage through the Strait of Hormuz. In a joint statement issued by British Prime Minister Keir Starmer’s office, the leaders of these countries condemned Iran’s attacks and urged it to immediately stop its actions.
On Thursday, US Treasury Secretary Scott Bessent said the United States could soon lift sanctions on Iranian tankers and release crude from its strategic oil reserves.
With the Federal Reserve expressing increased uncertainty about the outlook for growth and inflation earlier this week, traders have lowered their expectations for a Fed rate cut. This has left traditional crypto and venture assets largely at the mercy of oil price fluctuations.
The latest drop in oil prices, while positive, does not end the uncertainty as military conflict continues in the Middle East. WTI remains near recent support at $92.00, still significantly above pre-war valuations.
“For now, WTI crude continues to hold what appears to be an increasingly important area of support. This level aligns well with previous highs and the short-term trend. As long as oil maintains this support and the trend continues higher, it will likely maintain an upward bias,” Mott Capital Management said in an email to subscribers.
The company added that its positioning in the oil options market suggests higher levels are possible.
Another market that Bitcoin traders might want to monitor is the S&P 500, Wall Street’s benchmark stock index.
The index closed below its pivotal 200-day simple moving average (SMA) on Thursday – the first such occurrence since May last year – signaling a shift in bearish momentum. A potential strengthening of risk aversion in stocks could spill over into crypto and broader financial markets.
