Oil prices saw a significant surge of $3 per barrel on Friday, driven by concerns of escalating tensions in the Middle East. The market became increasingly worried about potential disruptions to oil supply as a result. Although the benchmark contracts initially jumped by over $3, they later eased slightly. At 02:00 GMT, Brent futures showed a notable increase of $2.63, representing a 3 percent rise, bringing the price to $89.74 per barrel. Similarly, the most active U.S. West Texas Intermediate (WTI) contract climbed by $2.56, or 3.1 percent, reaching $84.66 per barrel.
Read more: Oil prices stabilize after steep declines amid U.S. rate hike fears, Venezuela sanctions
In terms of global crude oil supply, Venezuela encountered a setback as it lost a crucial U.S. license that previously allowed the country, an OPEC member, to export oil worldwide. Additionally, the United States announced sanctions on Iran, although these sanctions did not include restrictions on its oil industry.
Interest rates, crude inventories impact prices
The oil prices remained relatively stable on Thursday, following significant losses in the previous session. The decline was primarily driven by concerns about the potential for prolonged higher interest rates in the U.S., as well as an unexpectedly large increase in U.S. crude inventories. Although geopolitical tensions in the Middle East continued to be a source of concern for the markets, this was mitigated by data showing record-high U.S. oil production and a substantial build-up in inventories. The combination of these factors, along with fears of extended higher U.S. interest rates, resulted in the sharp decline in oil prices on Wednesday.
During Thursday’s trading, Brent crude futures for June delivery experienced a slight rise to $87.42 per barrel, while West Texas Intermediate (WTI) crude futures remained flat at $82.20 per barrel as of 01:51 GMT. Both benchmarks had previously tumbled by approximately 3 percent in the preceding session.
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