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Oil prices inched higher on Friday, supported by renewed geopolitical tensions and targeted U.S. policy moves that heightened concerns over potential supply disruptions, even as the broader market remains on track for its steepest annual decline in four years.
Brent crude futures rose 0.1% to $62.29 a barrel by 06:06 GMT, while U.S. West Texas Intermediate (WTI) crude gained 6 cents to $58.41. Trading volumes remained light amid year-end holidays, but geopolitical developments kept a floor under prices.
U.S. Escalates Economic Pressure on Venezuela; Nigeria Airstrikes Raise Regional Security Risks
The White House ordered U.S. forces to prioritize a “quarantine” of Venezuelan oil shipments over the next two months, signaling a strategy centered on economic pressure rather than direct confrontation with Caracas. Venezuela remains a key crude supplier to select global markets, and tighter enforcement threatens to constrain export flows.
Meanwhile, the U.S. conducted joint airstrikes with Nigerian authorities against Islamic State militants in Nigeria’s Sokoto state. Although Nigeria’s major oilfields are located in the south, the escalation widened the perceived geopolitical risk premium in one of Africa’s largest crude producers.
Despite Latest Bounce, Oil Heads for Biggest Annual Drop Since 2020
Even with Friday’s modest gains, both benchmarks remain on course for sharp annual losses as traders weigh resilient U.S. output, rising non-OPEC supply, and signs of softening demand growth.
Brent and WTI are on track to fall about 16% and 18% respectively in 2025, marking their steepest yearly declines since the COVID-era collapse in fuel consumption. Markets continue to price in expectations that global supply will outpace demand next year, limiting upside momentum.
Additional Supply Disruptions Emerge in Kazakhstan
Separately, shipments through the Caspian Pipeline Consortium (CPC) — a major export route for Kazakh crude — are expected to fall by roughly one-third in December after a Ukrainian drone strike damaged facilities at the pipeline’s main terminal, according to market sources. The outage reinforces the fragile nature of energy infrastructure across conflict-affected regions.
U.S. Inventory Data Delayed to Monday
Traders are also awaiting official U.S. crude inventory figures from the Energy Information Administration, rescheduled to Monday due to the Christmas holiday. The report will provide key insight into consumption trends in the world’s largest oil market heading into the new year.
With macro headwinds still dominating the outlook, short-term price direction is likely to remain driven by geopolitical risk headlines versus supply-demand fundamentals — a tension that continues to define crude markets as 2025 draws to a close.
