Global crude oil prices remained on track for a weekly gain on Friday as investors continued to factor in supply risks linked to renewed tensions in the Middle East, despite a modest pullback from the week's highs and expectations of additional oil entering the market.
As of 1:30 p.m. WAT, Brent crude traded at $76.89 per barrel, up $0.59 or 0.77%, while West Texas Intermediate (WTI) rose to $72.56 per barrel, gaining $0.48 or 0.67%.
The gains cap a volatile trading week during which crude prices swung sharply amid heightened concerns over the security of oil shipments through the Strait of Hormuz. Brent and WTI both rallied earlier in the week before surrendering part of those gains as traders reassessed the likelihood of prolonged supply disruptions.
Market sentiment has largely been shaped by renewed hostilities involving the United States and Iran, with concerns that any disruption to traffic through the Strait of Hormuz could tighten global oil supplies. The strategic waterway handles roughly one-fifth of global oil shipments, making developments in the region a key driver of price movements.
The geopolitical premium has outweighed bearish market signals, including OPEC+'s decision to raise production targets for August and an unexpected increase in U.S. crude inventories, both of which would ordinarily weigh on crude prices.
Although OPEC+ agreed to continue restoring previously withheld production, traders have remained focused on whether the additional barrels can reach global markets without further disruption.
Shipping activity through the Strait of Hormuz also remains below pre-conflict levels. Analysts noted that tanker movements have yet to fully recover as vessel operators continue to monitor security risks in the region.
According to energy analyst Vandana Hari, crude prices have retreated from their mid-week highs but continue to reflect a sizeable geopolitical risk premium because uncertainty over shipping through the Strait of Hormuz persists.
She added that expectations of a return to diplomatic negotiations between the United States and Iran have helped prevent a sharper rise in oil prices, even after recent military exchanges and renewed sanctions on Iranian crude exports.
ING commodity strategist Warren Patterson said commercial vessel traffic through the Strait remains well below normal levels, highlighting that safe navigation continues to be a concern for market participants.
He noted that crude exports from the Middle East are averaging around 14 million barrels per day, compared with approximately 20 million barrels per day before the conflict, indicating that regional oil flows have not yet returned to normal.
Despite the week's volatility, crude prices remain on course to post a weekly gain, underscoring how supply concerns continue to dominate market sentiment even as traders monitor additional production from OPEC+ and evolving geopolitical developments in the Gulf.