On Tuesday, West Texas Intermediate (WTI) oil was highly volatile. Prices fell back to Friday's low relative to the day's open. Earlier, the contract had climbed above $100, setting a new monthly high, but then reversed. Market pressure rose after reports of a new diplomatic proposal between the US and Iran increased expectations of a possible easing of Middle East tensions.

According to Israel's Channel 12, Pakistan's military leadership presented a compromise plan to senior Iranian officials on Tuesday, backed by Washington and preliminarily approved by Tehran. Pakistan and Qatar are reportedly serving as intermediaries in efforts to resolve the dispute between the two countries.

The initiative's main task is to prevent further escalation and create conditions for resuming talks between the US and Iran. Although details of the potential agreement are scarce, the prospect of diplomatic progress alone reduces the geopolitical premium priced into oil.

Reportedly, the plan partially accommodates Iranian demands related to unfreezing assets held abroad. Channel 12 says Tehran could receive interest payments on roughly $6 billion held in Qatari bank accounts. That measure would be a financial concession designed to facilitate negotiations, while the bulk of frozen funds would remain blocked.

In addition, a Qatari report cited by Channel 12 claims Iran has agreed to a confidential visit by IAEA inspectors to its nuclear sites. A non-public inspection could ease US concerns about Iran's nuclear program.

However, the parties have not officially confirmed the reported understandings, and the precise commitments remain unknown. Preliminary consent does not guarantee a final deal.

Technically, WTI trades around $97.90 and retains an overall constructive bullish structure: prices sit above key moving averages, including the 100-period and 200-period simple moving averages (SMA), and remain above nearby horizontal support at $95.00, indicating ongoing demand on pullbacks. Oscillators are positive, supporting the bulls' edge.

If selling pressure intensifies, the first support is the $95.00 horizontal level, with the next support around the round $94.00 mark. On the upside, the nearest significant resistance is the month's high — a sustained close above that level would likely set the stage for a resumption of the main uptrend.