Oil prices moved higher on Friday, extending weekly gains as skepticism persists around the likelihood of a near-term ceasefire in the month-long Iran conflict.
Brent crude rose $4.56, or 4.2%, to settle at $112.57 per barrel, while U.S. West Texas Intermediate (WTI) gained $5.16, or 5.5%, to close at $99.64. Since late February—just ahead of the escalation involving Iran—Brent has climbed approximately 53%, with WTI up about 45%. On a weekly basis, Brent edged up roughly 0.3%, while WTI advanced more than 1%.
Market participants remain cautious, focusing more on the potential duration and escalation of the conflict than on shifting political rhetoric. Concerns over prolonged disruption—particularly any extended closure of the Strait of Hormuz or damage to critical energy infrastructure—continue to support a sizable geopolitical risk premium in prices.
The conflict has removed an estimated 11 million barrels per day from global supply, significantly tightening market conditions. Ongoing restrictions on flows through the Strait of Hormuz are exacerbating the imbalance, keeping supply constrained.
While a de-escalation could lead to a sharp pullback in prices—albeit likely still above pre-conflict levels—further escalation could drive prices materially higher. Some market estimates suggest crude could approach $200 per barrel if disruptions persist into the coming months.
Separately, Russian producers have signaled potential supply disruptions from Baltic Sea export routes following continued attacks on energy infrastructure, adding another layer of uncertainty to the global supply outlook.