Oil Holds Near $100 as Iran War Keeps Supply Risks Elevated

Oil prices eased slightly on Friday but remained close to the $100 per barrel level, as persistent concerns over supply disruptions linked to the U.S.–Israel war with Iran continued to dominate market sentiment.

By 06:44 ET (10:44 GMT), Brent crude futures for May slipped 0.3% to $100.17 per barrel, while West Texas Intermediate (WTI) crude fell 0.9% to $94.92 per barrel. Despite the modest pullback, Brent remained on track for a second consecutive week of strong gains.

U.S. waivers for Russian oil limit declines

Crude prices initially dropped as much as 1% after the U.S. Treasury Department announced it would permit the purchase of Russian oil that was already at sea, a move aimed at offsetting supply shocks caused by the Middle East conflict.

Treasury Secretary Scott Bessent said the measure was designed to stabilize global energy markets amid the disruption stemming from the war with Iran.

Earlier in the week, Washington had also issued waivers allowing certain Russian oil shipments to proceed, including deliveries to India, the world’s third-largest crude importer.

Hormuz tensions keep markets on edge

Despite these measures, oil prices remained elevated as tensions around the Strait of Hormuz continued to threaten global supply.

Bessent noted that the U.S. Navy may escort commercial vessels through the strait, a critical maritime corridor south of Iran through which roughly 20% of the world’s oil supply passes.

Shipping through the waterway has effectively stalled as tanker operators avoid the route due to fears of Iranian attacks, raising the risk of major supply disruptions.

The resulting spike in energy prices has increased concerns about an inflation shock, which could prompt central banks worldwide to adopt a more hawkish monetary policy stance.

Oil markets swing sharply

Oil prices have experienced dramatic volatility throughout the week.

At one stage, Brent crude surged close to $120 per barrel, before retreating below $90 as traders reacted to shifting geopolitical developments and policy responses.

While the sharp swings have dominated headlines, analysts at Capital Economics say the key question now is whether the current price surge will prove temporary or persist if disruptions continue.

Conflict intensifies

The war between the United States, Israel, and Iran has now continued for more than a week, with ongoing airstrikes on Iranian targets and retaliatory missile and drone attacks by Tehran.

Several attacks have reportedly targeted oil infrastructure across parts of the Middle East, heightening concerns about prolonged supply disruptions.

Iran’s new Supreme Leader Mojtaba Khamenei has vowed to block the Strait of Hormuz, a move analysts say could be intended to increase leverage over Washington and its allies.

With the strategic waterway under threat and energy facilities increasingly targeted, global oil markets remain highly sensitive to further developments in the conflict.