Oil Prices Slip Weekly but Remain Elevated
Oil prices were set for a weekly decline on Friday after U.S. President Donald Trump extended a 10-day pause on attacks targeting Iran’s energy infrastructure. Despite this temporary relief, markets remain tense as a quick resolution to the conflict appears unlikely.
Market Performance and Price Movements
Oil benchmarks showed little movement following a strong previous session. Brent crude edged down by 4 cents to $107.97 per barrel, while U.S. West Texas Intermediate (WTI) crude fell 40 cents to $94.08 per barrel.
On a weekly basis, WTI—despite surging around 40% since the conflict began on February 28—declined by 4.6%. Brent crude, which has risen more than 48% during the same period, recorded a 4% weekly drop.
War Outlook Drives Oil Market Sentiment
According to Priyanka Sachdeva of Phillip Nova, oil markets are being driven more by expectations of prolonged conflict rather than short-term diplomatic developments. Any escalation or direct damage to energy infrastructure could trigger sharp price increases.
Rising Geopolitical Risks
Although Trump has extended the deadline to April 6 for Iran to reopen the Strait of Hormuz, the U.S. has simultaneously increased its military presence in the region. Reports suggest that Washington is considering further action, including the possible deployment of ground forces to secure key oil facilities such as Kharg Island.
Meanwhile, Iranian officials have rejected a U.S. proposal delivered via Pakistan, describing it as unbalanced and unfavorable.
Supply Shock and Global Impact
The ongoing conflict has removed approximately 11 million barrels per day from global oil supply. The International Energy Agency has described the situation as more severe than both the oil crises of the 1970s and the gas disruptions linked to the Russia-Ukraine war.
Price Outlook: Risk of Sharp Moves Ahead
Analysts at Macquarie Group suggest that oil prices could decline in the coming months if tensions ease. However, even in that scenario, prices are likely to remain above pre-conflict levels.
On the other hand, if the conflict continues through the end of June, oil prices could surge as high as $200 per barrel.
Growing Pressure on Global Markets
Mukesh Sahdev of XAnalysts noted that market pressure is intensifying with each passing day. Several Asian countries are already tapping into emergency reserves and considering adjustments to demand in response to rising energy costs.
