Oil prices moved higher on Friday, supported by renewed concerns over supply disruptions in Saudi Arabia and continued paralysis in tanker movements through the strategically vital Strait of Hormuz.
Despite the uptick, crude remained on track for a weekly decline as market tensions eased somewhat following a fragile two-week ceasefire agreement between the United States and Iran. Sentiment was also helped by signals from Israel pointing to a possible diplomatic opening, with officials indicating readiness to begin direct talks with Lebanon.
Brent crude futures rose by 96 cents, or 1%, to $96.88 per barrel as of 06:04 GMT, while U.S. West Texas Intermediate gained 78 cents, or 0.80%, to $98.65 per barrel.
Even with Friday’s gains, both benchmarks have fallen roughly 11% so far this week, marking the steepest weekly drop since June 2025, when earlier Israeli-U.S. military actions against Iran were halted.
Recent attacks targeting Saudi energy infrastructure have reduced the country’s oil production capacity by about 600,000 barrels per day and cut throughput along the East-West Pipeline by approximately 700,000 barrels per day, according to Saudi state news agency SPA, citing an official source at the Energy Ministry.
Analysts at ANZ noted that these developments have intensified concerns about further disruptions to global oil supply.
Meanwhile, tanker traffic through the Strait of Hormuz remained at a fraction of normal levels, with volumes below 10% of usual activity on Thursday despite the ceasefire. Iran has reinforced its control over the route by instructing vessels to remain within its territorial waters during transit.
Although Iran and the U.S. agreed earlier in the week to a two-week ceasefire mediated by Pakistan, hostilities have persisted since the announcement.
Market observers suggest that Pakistan may attempt to facilitate a longer-term peace agreement, though it may lack sufficient influence to ensure the full reopening of the key maritime corridor.
Iran has reportedly proposed introducing transit fees for vessels using the strait as part of any broader peace arrangement, a suggestion that has been met with resistance from Western governments and the United Nations’ maritime authorities.
The Strait of Hormuz, a critical channel for global oil and gas shipments, has been effectively constrained since the conflict began on February 28, when the U.S. and Israel launched coordinated airstrikes on Iran.
According to John Paisie, president of Stratas Advisors, Brent crude could surge to as high as $190 per barrel if current restrictions on shipping flows persist.
“If Iran allows increasing flows the price of oil will be more moderated, but still well above pre-war levels.”
Mukesh Sahdev, founder and CEO of XAnalysts, said the “key variable now is how flows through the Strait of Hormuz actually resume – not whether they reopen.”
Since the onset of the conflict, around 50 infrastructure sites across the Gulf have been hit by drone and missile strikes, with roughly 2.4 million barrels per day of refining capacity taken offline, according to estimates from JPMorgan.