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Reuters reported that Brent crude futures advanced $1.05 to $85.28 a barrel on Friday while West Texas Intermediate futures gained $1.03 to $79.98 a barrel erasing earlier losses in the session. Both benchmarks have risen nearly 12 percent this week with Brent heading for a third straight weekly gain and WTI set for its second. The increases reflect fresh supply risks stemming from the renewed conflict according to trading data compiled by the news service.
The United States launched two major waves of air strikes on Wednesday near Iran’s southern coast for the first time since last month’s truce collapsed and continued operations on Thursday. U.S. Central Command said in a statement that American forces initiated a new wave of strikes against Iran for the sixth consecutive night at 2 p.m. EDT to further degrade Iranian military capabilities. Tehran has responded with missile and drone attacks on U.S. bases in neighboring countries.
Iranian leadership has instructed its Houthi allies to ready a shutdown of the Red Sea oil export route should the United States target Iranian power infrastructure three sources told Reuters. The broken truce has already restricted oil flows through the Strait of Hormuz a chokepoint that normally carries about one fifth of global supplies according to U.S. Energy Information Administration figures. Gulf exports slipped below 50 percent of pre-war levels over the past week a Goldman Sachs assessment found.
International Energy Agency Executive Director Fatih Birol said on Thursday at a Council on Foreign Relations event in Washington that oil security remains a critical issue. Birol added “We should be worried and I am worried if the situation does not improve in the next few weeks.” His comments came as the agency tracks the impact of hostilities on global energy flows.
IG analysts said WTI could test the mid-80s range provided it holds above key support levels in the mid-70s. Goldman Sachs analysts projected in a note this week that Brent could exceed $110 a barrel in the fourth quarter if current disruptions continue. The price action follows a memorandum of understanding that had paused fighting only last month according to Reuters timelines.
U.S. Central Command confirmed the latest strikes targeted Iranian capabilities linked to threats against shipping lanes. Market data from Reuters showed the weekly gains building despite earlier volatility tied to ceasefire talks that ultimately faltered. Iranian counterstrikes have included barrages aimed at an expanded U.S. air base in Jordan further elevating regional tensions.
