Oil prices edged lower on Friday as traders assessed reports that the United States may be close to securing access to Venezuela’s oil reserves.
Markets were also watching developments between the US and Iran over the Strait of Hormuz, a key route for global crude shipments.
Brent crude futures fell around 0.4% to $89.38 a barrel, while West Texas Intermediate crude futures declined roughly 0.6% to $83.01 a barrel.
Both benchmarks were on track to post weekly losses of between 4% and 5.5%, despite a strong rebound during Thursday’s session.
US Nears Deal for Access to Venezuelan Oil
The Trump administration is reportedly close to reaching an agreement that would give the United States long-term access to part of Venezuela’s large crude oil reserves.
According to reports, the deal could allow a group of Venezuelan oilfields to be developed by American companies.
The possibility of additional Venezuelan supply has weighed on oil market sentiment, as traders consider how greater US involvement in the country’s energy sector could affect global production.
However, analysts have warned that any significant rise in output is unlikely to happen quickly.
Venezuela’s oil infrastructure requires substantial investment and development before production can increase meaningfully.
Venezuela Reportedly Considers Leaving OPEC
Separate reports suggest that Venezuela is also considering a potential withdrawal from the Organization of the Petroleum Exporting Countries, or OPEC.
Such a move would represent a significant shift for the oil-producing nation as its relationship with Washington continues to strengthen.
It would also mark another major departure from the producer group following reports that the United Arab Emirates plans to leave OPEC.
Strait of Hormuz Remains a Major Market Focus
Oil prices have also been pressured by developments surrounding the Strait of Hormuz.
Earlier reports indicated that Iran and Oman had agreed to allow some traffic through the strategic waterway.
Iran later said it was preparing a list of conditions that would need to be met before the strait could fully reopen.
The prospect of renewed shipping through Hormuz has eased some supply concerns because the route accounted for roughly one-fifth of global oil flows before the US-Iran conflict.
US-Iran Tensions Keep Oil Markets Volatile
Crude prices recovered part of their weekly losses on Thursday after reports suggested that President Donald Trump was not interested in returning to a previous peace agreement with Iran.
Tehran has continued to call on Washington to honor the terms of the earlier agreement before further negotiations can take place.
The deal reportedly expired earlier in August.
With uncertainty surrounding both Venezuela’s future oil supply and the Strait of Hormuz, crude markets are likely to remain sensitive to geopolitical developments and any signs of changing global supply conditions.
