Noor Trends News, Technical Analysis, Educational Tools and Recommendations
Oil prices edged higher in Asian trading on Friday, building on strong gains from the previous two sessions and putting benchmarks on course for a weekly rise of around 6%, as escalating tensions between the United States and Iran stoked fears of supply disruptions in the Middle East.
By 22:41 ET (03:41 GMT), Brent crude futures for April delivery rose 0.2% to $71.81 a barrel, while U.S. West Texas Intermediate (WTI) crude futures gained 0.5% to $66.78 a barrel. Both contracts hovered near their highest levels since early August and were poised to post weekly gains of more than 6%.
Geopolitical Risks Push Oil Toward Multi-Month Highs
Investor focus has increasingly shifted to the risk of a potential confrontation between Washington and Tehran. U.S. President Donald Trump warned this week that “bad things” would happen if Iran failed to reach a nuclear deal within the next 10 to 15 days, significantly raising the prospect of military action.
According to a Wall Street Journal report, Trump is considering a limited strike on Iranian targets as a means of pressuring Tehran into an agreement. Any escalation involving Iran—a major OPEC oil producer—could threaten crude flows through the Strait of Hormuz, a strategic chokepoint that handles roughly one-fifth of global oil shipments.
Oil’s sharp rally this week also reflects a reversal of earlier losses. Prices had initially declined at the start of the week on optimism that U.S.–Iran nuclear talks were making progress. However, increasingly hardline rhetoric has since restored a sizable geopolitical risk premium, lifting crude prices to multi-week highs.
U.S. Inventory Data Adds to Bullish Momentum
Further support came from U.S. supply data that surprised markets. Figures released by the Energy Information Administration on Thursday showed U.S. crude inventories fell by around 9 million barrels in the latest week, sharply defying expectations for a build of approximately 1.7 million barrels.
The report also showed declines in gasoline and distillate inventories, both larger than anticipated, pointing to strong demand from refiners and consumers.
Looking ahead, markets are also monitoring the U.S. Personal Consumption Expenditures (PCE) price index due later on Friday. As the Federal Reserve’s preferred inflation gauge, the data could influence expectations for U.S. interest rates, particularly after recent hawkish Fed minutes signaled reluctance to cut rates in the near term.
For now, geopolitical tensions and tightening supply indicators continue to dominate sentiment, keeping oil prices firmly supported.
