Oil prices are heading for a second week of gains amid geopolitical tensions

Oil prices continued their ascent on Friday, poised to mark a second consecutive week of gains, buoyed by geopolitical tensions in Europe and the Middle East, concerns over dwindling supplies, and optimism surrounding global fuel demand as economies recover.

Brent crude surged by 49 cents, or 0.5 percent, reaching $91.14 a barrel by 0108 GMT. Similarly, US West Texas Intermediate crude climbed by 37 cents, or 0.4 percent, hitting $86.96 a barrel.

Both benchmarks attained their highest levels since October at the close of trading on Thursday.

The two crude oil prices are on track to log gains exceeding four percent for the week, extending their upward trajectory for the second consecutive week. The rally was sparked after Iran, the third-largest producer in OPEC, vowed retaliation against Israel for an attack that resulted in the deaths of several senior Iranian military personnel.

Although Israel did not claim responsibility for the attack on the Iranian embassy compound in Syria on Monday, tensions escalated in the region.

A NATO official revealed on Thursday that ongoing Ukrainian drone strikes targeting refineries in Russia may have disrupted more than 15 percent of the country’s production capacity, consequently impacting fuel production.

In the backdrop of these developments, the Organization of the Petroleum Exporting Countries (OPEC) and its allies, led by Russia, maintained their oil supply policy unchanged within the OPEC+ alliance this week, while pressuring some nations to bolster their commitment to production cuts.

Meanwhile, global oil demand exhibited robust growth, reaching 1.4 million barrels per day in the first quarter, according to analysts at JP Morgan. Their analysis indicates that total oil consumption in March averaged 101.2 million barrels per day, slightly surpassing previous estimates.

Investors are eagerly awaiting the US jobs report for March, slated for release later on Friday, seeking further insights into the strength of the US economy and the trajectory of the country’s monetary policy.