Oil prices fell over $2 a barrel on Friday, with Brent settling at $74.43 (-2.68%) and WTI at $70.40 (-2.87%), marking a weekly decline of 0.4% and 0.5%, respectively. The drop was driven by easing geopolitical tensions, particularly a fading Middle East risk premium as the Gaza ceasefire held, along with uncertainty over a potential Ukraine peace deal.
Despite concerns over supply disruptions, including a Ukrainian drone attack that reduced Caspian Pipeline Consortium (CPC) oil flows by 30-40%, Kazakhstan managed to maintain record-high output. Meanwhile, U.S. crude stockpiles rose due to seasonal refinery maintenance, and oil and gas rigs increased for a fourth consecutive week to 592, the highest level since June.
Tensions between Ukraine and the U.S. escalated as President Zelenskiy criticized peace talks that excluded Kyiv, but later signaled a willingness to negotiate a security and investment agreement. Trump’s stance on Ukraine and potential easing of Russian sanctions also weighed on market sentiment.
Looking ahead, analysts expect short-term demand support from cold U.S. weather and increased industrial activity in China, while traders watch for OPEC+ decisions and further geopolitical developments.