Bitcoin Pares Losses as Oil Prices Pull Back From Highs

Bitcoin clawed its way back above the $70,000 mark on Thursday after earlier sliding on a sharp spike in oil prices triggered by fresh Middle East tensions. The world’s largest cryptocurrency trimmed its losses and was last trading at $70,485, down just 0.2% on the day according to LSEG data.

The catalyst for the brief crypto sell-off was a sudden surge in crude prices. Brent crude futures shot above $100 per barrel earlier in the session before pulling back sharply to $97.93. The spike followed reports that two foreign fuel tankers were attacked in Iraqi waters on Wednesday, escalating fears that the widening Middle East conflict could disrupt global oil supplies.

Oil remains the dominant driver of macroeconomic sentiment right now, according to Marex crypto analyst Louis De Backer.

“When crude spikes, the market immediately reprices inflation risks and cryptocurrencies are treated as risk-sensitive assets,” De Backer noted in a client note. “Any threat to energy markets forces investors to reassess growth expectations and monetary policy paths — and Bitcoin, like equities, feels that pressure instantly.”

The episode highlights how intertwined crypto has become with traditional commodity markets. Earlier this week, escalating geopolitical headlines had already pushed Bitcoin below $70,000 as traders priced in higher inflation and a potentially more hawkish stance from central banks. The rapid retreat in oil prices, however, eased those fears and allowed risk assets — including Bitcoin — to stabilise.

Market participants are now watching two key factors: whether the tanker incidents lead to sustained supply disruptions in the Gulf region, and how quickly OPEC+ or major producers respond. For now, the pullback in Brent has given Bitcoin breathing room, but analysts warn that any renewed spike toward or above $100 could quickly reignite downside pressure on crypto.

As of Thursday evening, Bitcoin continues to hover near the psychologically important $70,000 level. Traders will be closely monitoring Friday’s oil inventory data and any fresh updates from the Middle East for the next directional cue.