Oil Prices Set For Hefty Weekly Gains

Oil prices held steady on Friday but were on track for hefty weekly gains due to severe disruption in tanker traffic through the Strait of Hormuz.

Benchmark Brent crude futures were little changed after climbing above $85 a barrel on Thursday amid the worsening conflict in the Middle East.

WTI crude futures were up 0.6 percent at $81.47 after climbing 8.5 percent on Thursday following reports that Iran struck a U.S. oil tanker in the northern Persian Gulf.

Oil prices are set for a 16 percent weekly gain as the Middle East war unleashed by U.S.-Israeli attacks on Iran swelled outwards to Cyprus, Sri Lanka, Turkey and Azerbaijan, raising concerns about the outlook for trade, prices and investment.

As the furious military operations in the Middle East region entered 7th day, U.S. President Donald Trump said the U.S. wants to be involved in the process of choosing the person who is going to lead Iran into the future. He also encouraged Iranian Kurdish forces to go on the offensive.

The U.S. military said it struck an Iranian vessel described as a “drone carrier.” Iran said that new inventions are on the wary and it is ready for a long war.

Iran has launched a fresh wave of missile and drone strikes across the Gulf, with attacks reported in the United Arab Emirates, Bahrain, Qatar and Kuwait.

Azeri president sought Iran’s apology for the drone attack in Nakhchivan, but Tehran denied role in the incident.

Helping ease supply concerns to some extent, the United States has given India a waiver to buy Russian oil for 30 days.

The Trump administration is considering emergency measures, including state insurance guarantees for tankers and naval escort to counter rising energy prices.

Also, it was said the White House is discussing the possibility of a large-scale release of oil from the Strategic Petroleum Reserve (SPR) in coordination with IEA partners.

Market Analysis