- The Strait of Hormuz remains almost quiet after fighting.
- Tanker traffic suspended as ship owners assess safety risks.
- Hormuz handled about 20% of the global oil and gas supply before the war.
Oil prices rose on Friday and were set for weekly gains on renewed fears of supply disruptions from the Middle East’s main producing region after renewed fighting between the United States and Iran this week restricted shipping in the Strait of Hormuz.
Brent futures rose 19 cents, or 0.25%, to $76.49 a barrel. barrel at 0319 GMT. US West Texas Intermediate (WTI) crude rose 19 cents, or 0.26%, to $72.27.
For the week, Brent was set for a gain of around 6% and WTI was on course for a 5% gain.
“Prices have pulled back from mid-week highs, but there is still a significant risk premium as Hormuz transits are back to a near standstill with no clear indication of when normal reopening may resume,” said Vandana Hari, founder of oil market analysis provider Vanda Insights.
“However, market confidence in the US and Iran returning to diplomacy to resolve the issue appears to limit the upside,” Hari added.
Iranian armed forces launched attacks on US military infrastructure in the Gulf states on Thursday after US strikes on Iran’s southern coastal and eastern provinces, further straining a three-week-old ceasefire.
Separately, Iranian media reported several explosions across southern Iran, including Bushehr, where one of the country’s nuclear power plants is located.
The renewed fighting came on the day Iran buried its slain supreme leader, Ayatollah Ali Khamenei, the culmination of a week of mass funeral processions and rallies. Khamenei was killed on the first day of the war, February 28.
The renewed fighting has delayed the full reopening of the Strait of Hormuz, which before the war carried about 20% of daily global oil and gas supplies.
Tanker traffic through the strait was almost at a standstill on Thursday, according to ship-tracking data, as vessel owners assessed the risk from the latest attacks, which started after Iran hit a Qatari LNG ship that left the waterway near Oman.
Still, US President Donald Trump said on Wednesday that he did not think the war would start again because of the new fighting and that “whatever happens will be over very quickly.”
“Despite the US stepping up attacks on military sites in Iran, the market took some reassurance from the Trump administration’s decision to avoid targeting Iranian energy infrastructure,” said Daniel Hynes, senior commodities strategist for ANZ bank.
“This was helped by comments from President Trump, who said he does not expect a return to full-scale conflict.”
