Oil Prices Edge Higher as US-Iran Tensions Keep Markets Focused on Hormuz
Oil prices moved slightly higher on Friday after U.S. and Iranian forces exchanged fire near the Strait of Hormuz, increasing concerns over potential disruptions to global energy supplies.
Despite the latest escalation, President Donald Trump stated that the month-old ceasefire between Washington and Tehran remained intact.
Brent crude traded just above $100 per barrel, while investor attention remained fixed on geopolitical developments in the Middle East.
Brent and WTI Crude Post Modest Gains
As of Friday morning trading, Brent crude futures rose 0.2% to around $100 per barrel.
Meanwhile, West Texas Intermediate crude futures gained 0.4% to $95.16 per barrel.
Oil markets also reacted to stronger-than-expected U.S. labor market data released earlier in the day.
US Jobs Data Beats Expectations
According to the U.S. Bureau of Labor Statistics, nonfarm payrolls increased by 115,000 in April, surpassing analyst expectations of 65,000 new jobs.
The unemployment rate remained unchanged at 4.3%.
The stronger labor market data highlighted continued resilience in the U.S. economy despite ongoing geopolitical uncertainty and elevated inflation concerns.
Hormuz Conflict Raises Supply Concerns
Geopolitical tensions intensified after Iran accused the United States of targeting an Iranian oil tanker and another vessel entering the Strait of Hormuz.
Iran also claimed that U.S. forces carried out strikes near Qeshm Island and surrounding coastal regions.
In response, the U.S. military stated that it acted in self-defense after Iranian drones, missiles, and small boats targeted three U.S. Navy destroyers operating in the strategic waterway.
Washington added that no American assets were damaged during the incident.
Trump Attempts to Calm Markets
President Trump attempted to reassure markets by describing the confrontation as limited and insisting that the ceasefire with Iran was still holding.
Iranian state media later reported that conditions in the affected areas had returned to normal.
Even so, traders remained cautious due to the strategic importance of the Strait of Hormuz, a key shipping route responsible for roughly one-fifth of global oil and liquefied natural gas supplies.
Oil Still Heads for Weekly Decline
Despite Friday’s gains, oil prices were still on track for a weekly decline of approximately 7% as markets continued to price in the possibility of a broader peace agreement between Washington and Tehran.
Analysts noted that crude oil prices are likely to remain heavily influenced by geopolitical headlines in the coming weeks.
The latest military exchange marked the most serious violation so far of the fragile ceasefire brokered earlier this year after weeks of conflict between the United States and Iran.
Diplomatic negotiations are still ongoing, with reports indicating that Pakistan-led mediation efforts continue as both sides evaluate the latest peace proposal.
