Crude oil prices declined on Friday, extending losses from the previous session, as worries over supply disruptions eased with the reduced likelihood of a U.S. strike on Iran.
Brent crude slipped 21 cents, or 0.3%, to $63.55 a barrel, while U.S. West Texas Intermediate fell 15 cents, or 0.3%, to $59.04 a barrel.
Meanwhile, back home, on the Multi-Commodity Exchange, February crude oil contracts were trading flat at ₹5,366 per barrel, tracking subdued global cues.
On Thursday, crude oil prices closed about 4% lower, snapping a five-session rally after US President Donald Trump said the crackdown on protesters in Iran was easing. Brent crude futures fell $2.76, or 4.15%, to settle at $63.76 a barrel, while US West Texas Intermediate slipped $2.83, or 4.56%, to $59.19.
Both benchmarks had climbed to multi-month highs earlier in the week after protests erupted in Iran and US President Donald Trump hinted at possible strikes on the country. Despite the pullback, Brent was still on track for a fourth consecutive week of gains.
What’s driving crude oil prices?
Trump said he had been informed that the pace of killings during Iran’s protest crackdown was slowing and that there was no immediate plan for mass executions. He signalled a wait-and-watch approach after earlier remarks that hinted at possible intervention.
Meanwhile, a US official was quoted as saying by Reuters that Washington is pulling some personnel out of military bases in the Middle East, following comments from a senior Iranian official that Tehran had warned neighbouring countries it would target US bases if America launched strikes.
Adding to downward pressure on prices, the Energy Information Administration reported on Wednesday that US crude and gasoline stockpiles rose last week by more than analysts had expected.
Separately, Venezuela has started rolling back oil output cuts imposed under a U.S. embargo, with crude exports also resuming, according to three sources.
Analysts told Reuters that market sentiment turned more bearish after a positive phone conversation between Trump and Venezuela’s acting President Delcy Rodríguez on Wednesday, raising expectations of short-term stability and increased Venezuelan oil flows in the coming weeks.
“ Crude oil prices fell sharply by nearly 4% in the previous session, driven by easing geopolitical risk premiums. President Donald Trump dialled back earlier threats of military action against Iran after receiving assurances that executions would not take place. Reports also suggested that Israel and other Middle Eastern allies advised Washington to postpone any potential strike. These factors reduced concerns over near-term supply disruptions from Iran or key regional shipping lanes. Despite the correction, crude prices remained on track for a modest weekly gain, underpinned earlier by unrest in Iran, political turmoil in Venezuela, and supply disruptions impacting Kazakhstan’s Black Sea exports,” Rahul Kalantri, VP Commodities, Mehta Equities Ltd, said.
Crude Oil Prices Outlook
Choice Institutional Equities said in a note that supply disruptions, whether geopolitical or operational, evolve into sustained and systemic constraints, and oil prices are likely to find sustained support.
“We expect that broad oversupply, underpinned by resilient US production and expanding inventory levels, would likely keep upward pressure on prices subdued,” the firm said.
The firm further added that it expects Brent to average to $61.5/b in 2026 in the backdrop of increased competition as a result of the relentless supply of oil from the US at lower prices, gradual unwinding of cuts by OPEC+ and possible removal of sanctions on Rosneft and Lukoil.
Meanwhile, Kalantri of Mehta Equities further added that crude oil prices are expected to remain volatile, with support at $58.40-$57.70 and resistance at $59.70-$60.40 in today’s session. In INR crude oil has support at ₹5,270-5,210 while resistance is at ₹5,2395-5,455, he said.
(With inputs from Reuters)
Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.
