- media@moneyinfocus.news
Oil prices edged higher on Friday, with WTI crude futures trading near $98 per barrel, though the benchmark remains on track for its largest weekly decline in nine months, reflecting shifting sentiment around geopolitical risks and supply disruptions.
The modest rebound comes amid cautious optimism that the war in the Middle East may be nearing a de-escalation phase. Diplomatic developments have gained momentum, with U.S. and Iranian delegations scheduled to meet in Pakistan on Saturday, while Israel has agreed to hold talks with Lebanon’s government, signaling a potential path toward easing regional tensions.
U.S. President Donald Trump expressed optimism about a possible agreement, stating that negotiations are progressing, while simultaneously issuing a warning to Tehran regarding proposed transit fees in the Strait of Hormuz, a critical artery for global oil flows.
Despite diplomatic progress, supply risks remain elevated. The Strait of Hormuz continues to operate under significant restrictions, with reports suggesting Iran is considering charging vessels for passage—raising concerns over long-term shipping costs and energy market stability.
Further tightening the supply outlook, Saudi Arabia reported that recent attacks on its oil facilities have reduced production capacity by approximately 600,000 barrels per day, while throughput on the East-West Pipeline has declined by around 700,000 barrels per day.
Even with these disruptions, oil markets have reacted more strongly to the prospect of easing geopolitical tensions, pushing prices lower over the week. The U.S. oil benchmark is down roughly 12%, underscoring how quickly risk premiums can unwind when diplomatic signals improve.
The current environment highlights a delicate balance between geopolitical de-escalation and persistent structural supply risks, leaving oil markets highly sensitive to both diplomatic outcomes and physical disruptions in key production regions.
Source: Market data and official statements
