Oil prices are erupting on Monday, following a drone strike in the Middle East over the weekend.

It's got light crude rallying 12.1% to $61.15 per barrel, while energy stocks charge higher as well. For instance, the SPDR Energy Sector ETF (XLE - Get Report) is up about 3% to $62.90 in midday Monday trading, with many individual names trading much higher than that. 

Many investors and commentators are worried about what the implications of a spike may mean going forward. The implications of the oil market are vast, as it not only impacts top- and bottom-line results across a key sector, but also affects consumers via gas prices. Heading into the all-important fourth quarter, the last thing global and U.S. consumers need is to be pinched at the pump.

Not surprisingly, it's also drawn commentary from economists about an oil-initiated recession. But let's keep a few things in mind. 

First, oil prices are back to the same level they were at in... June. Yep, oil is back to the same level it was at only two months ago, and is still more than $5 per barrel below its April highs.

That said, a prolonged rally in oil could certainly have economic ramifications. That's something investors don't want to see, nor does President Trump. On Sunday night, Trump tweeted about his willingness to release strategic oil reserves in order to infuse supply back into the market and help keep oil prices low.

Let's look at the charts.

Trading Oil Prices

Daily chart of crude oil.
Daily chart of crude oil.

The drone strike on Saudi Arabia's oil production shouldn't tie up oil production for too long. If this is a one-time event, then supply from U.S. producers should pressure prices lower, as Saudi oil comes back online. If tensions remain high in the Middle East, though, some risk premium will likely stay priced into crude oil. That's on top of any potential supply disruptions that may come down the road.

On the charts, investors can see the robust rally underway on Monday. The move clearly launched crude oil over the $58 mark, as well as the 50% retracement at $57.90.

Investors can also follow along by watching the United States Oil Fund LP (USO - Get Report) .

From here, bulls want to see crude oil prices reclaim the 61.8% retracement at $62.38. Above that puts the $64 level on the table, a key breakdown level last November and resistance throughout the second quarter, with the exception of a few days in April.

Over $64 and worries over the consumer impact will certainly start to make headlines.

On the downside, bulls will want to see the $58 level hold. Below it could usher in a test of the 50-day and 200-day moving averages. So far, buyers aren't backing away, as oil prices continue to drift higher throughout the session. 

This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.