Oil Prices Edge Higher Amid Middle East Supply Risks
Oil prices moved slightly higher during Asian trading on Friday, extending modest gains from the previous session. Markets remained focused on ongoing supply risks in the Middle East, particularly ahead of upcoming U.S.-Iran talks scheduled for the weekend.
Brent and WTI Post Modest Gains
Brent crude futures for June delivery rose 0.9% to $96.74 per barrel, while U.S. West Texas Intermediate (WTI) futures increased 0.7% to $98.54 per barrel.
Both benchmarks had closed higher on Thursday after trimming earlier gains. However, despite the recent rebound, oil prices were still on track to record weekly losses of more than 10%.
Strait of Hormuz Disruptions Support Prices
Oil markets continued to find support from disruptions in the Strait of Hormuz, a critical route for global oil shipments. The ongoing restrictions have raised concerns about supply stability and helped keep prices elevated.
Earlier in the week, oil prices had dropped sharply after U.S. President Donald Trump announced a temporary two-week ceasefire with Iran, conditional on the reopening of the Strait. The announcement initially raised hopes that oil flows would normalize.
Renewed Tensions Weigh on Ceasefire
Those hopes quickly faded as tensions escalated again. Israel launched significant airstrikes on Lebanon shortly after the ceasefire announcement, stating that its conflict with Hezbollah was not included in the agreement.
In response, Iran halted tanker movements through the Strait of Hormuz once more, citing Israel’s actions as a violation of the ceasefire terms.
Meanwhile, Israel indicated it is preparing to begin direct negotiations with Lebanon, suggesting a possible diplomatic path forward.
Uncertainty Ahead of US-Iran Talks
Investor sentiment remained cautious ahead of planned talks between the United States and Iran. Markets are closely monitoring developments, as any progress—or lack thereof—could significantly impact oil supply expectations.
Iranian media reported that Tehran denied claims of a delegation arriving in Islamabad for negotiations. Officials stated that discussions would remain suspended unless the U.S. honors commitments related to the ceasefire and Israeli military actions come to an end.
Rising Political Pressure Adds to Market Volatility
Earlier, President Donald Trump increased pressure on Iran, warning against imposing fees on vessels passing through the Strait of Hormuz. He also criticized Iran for failing to ensure stable energy flows, adding further uncertainty to an already fragile situation.
