Oil prices eased on Friday but remained firmly on track for significant weekly advances as investors continued to monitor growing geopolitical risks in the Middle East and the potential for further disruptions to global energy supplies.
Both Brent and U.S. West Texas Intermediate (WTI) crude were set to record substantial weekly gains despite profit-taking following Thursday’s sharp rally.
Brent retreats after surging above $100 per barrel
At 07:47 GMT, Brent crude futures were down $1.82, or 1.81%, at $98.87 per barrel after closing more than 7% higher in the previous session. During Thursday’s trading, Brent climbed above the $100 mark for the first time since May after Iran-backed Houthi forces claimed responsibility for attacks on two Saudi oil tankers in the Red Sea.
Even with Friday’s decline, Brent remained on course for a weekly gain of around 12%.
WTI futures also moved lower, falling $1.60, or 1.74%, to $90.59 per barrel, while remaining on track to finish the week nearly 9.7% higher.
Supply disruption fears continue to support prices
Market sentiment remains supported by concerns that the conflict could threaten critical energy infrastructure and major shipping routes.
“Major hubs of oil production or supply routes are surrounded by war,” said PVM Oil Associates analyst John Evans. “The short-term outlook is bullish.”
U.S. President Donald Trump warned of “major military punishment” against Iran and its Houthi allies following the attacks in the Red Sea.
According to reports, Iran has urged the Houthis to block access to the Bab el-Mandeb Strait should the United States continue targeting Iranian energy infrastructure. The strategic waterway is regarded as one of the world’s most important energy transport routes after the Strait of Hormuz.
Earlier in the week, the Houthis also announced a naval blockade against Saudi Arabia, which has increasingly relied on pipeline exports to bypass Iran’s closure of the Strait of Hormuz.
Shipping disruptions raise supply concerns
Data from shipping analytics company Kpler showed that only one oil tanker transited the Strait of Hormuz on Thursday, marking the lowest daily level since 7 May.
Analysts at JPMorgan estimate that every additional month of supply disruption could add between $7 and $8 per barrel to Brent prices. Should disruptions continue for three months, the bank believes average monthly Brent prices could climb to approximately $114 per barrel.
Russia and Kazakhstan add to market uncertainty
Elsewhere, Russia said its military carried out overnight strikes on three Ukrainian ports, targeting infrastructure including fuel storage facilities and cargo handling operations that support Ukraine’s armed forces.
Meanwhile, Kazakhstan’s energy ministry confirmed that oil producers temporarily reduced output after suspected Ukrainian drone attacks forced the closure of the country’s main Black Sea oil export terminal.