Oil prices climbed more than 1% on Friday, with markets continuing to focus on potential supply risks, even as concerns over an imminent U.S. military strike on Iran began to fade.
Brent crude advanced 84 cents, or 1.3%, to $64.60 a barrel by 14:13 GMT, putting it on track for a fourth straight weekly gain. U.S. West Texas Intermediate also moved higher, rising 80 cents, or 1.4%, to $59.99.
At these levels, Brent was heading for a weekly increase of around 2%, while WTI was set to gain roughly 1.4%. Brent prices briefly rose by more than $1 earlier in the session, as investors continued to assess the risk of supply disruptions should tensions in the Middle East intensify.
According to UBS analyst Giovanni Staunovo, geopolitical risks in the region have eased somewhat, but have not disappeared. He noted that market participants remain wary of possible supply interruptions.
Both oil benchmarks reached multi-month highs earlier in the week following protests in Iran and comments from U.S. President Donald Trump suggesting the possibility of military action. However, prices dropped more than 4% on Thursday after Trump said Iran’s response to the protests was easing, reducing fears of an escalation that could disrupt oil flows.
Analysts at Commerzbank warned that the biggest concern remains the risk of Iran blocking the Strait of Hormuz, a key route through which roughly a quarter of global seaborne oil supplies pass. They added that if tensions continue to cool, attention could shift back to developments in Venezuela, where previously sanctioned or restricted oil could gradually return to global markets.
Meanwhile, analysts expect overall oil supply to rise this year, potentially limiting the upside from geopolitical risk premiums. Priyanka Sachdeva, an analyst at Phillip Nova, said that despite ongoing geopolitical uncertainty and macroeconomic speculation, the underlying supply-demand balance still points to ample supply.
She added that unless there is a strong rebound in Chinese demand or a significant disruption in physical oil flows, prices are likely to remain range-bound, with Brent broadly trading between $57 and $67.
