Oil headed for its biggest weekly gain since July as renewed US-Iran hostilities heightened concerns about prolonged disruptions to energy flows through the Strait of Hormuz.
West Texas Intermediate rose toward $92 a barrel and was up more than 9% for the week. Brent settled below $96 in the previous session. The flare-up came after a period of relative calm, with the US bombing campaign earlier in the week met by Iranian retaliation against American bases in the region.
Iran’s forces continued to target vessels transiting Hormuz, and fired missiles at Jordan, Kuwait and Bahrain. Israel indicated it was prepared to resume fighting if necessary and that an Iranian attack would free it from existing restrictions, raising the prospect of another cycle of military escalation.
While fighting flared this week, Vice President JD Vance played down the scope of the conflict, saying he wouldn’t describe it as a war because major combat operations ended weeks ago. Republican Representative Pat Harrigan of North Carolina, who sits on the House Armed Services Committee, offered a different assessment, saying “very clearly militarily, we are stalled.”
Oil futures are up almost 60% this year, with refined products such as diesel seeing even steeper gains due to the Middle East conflict and the Russia-Ukraine war. US retail prices of the industrial fuel hit the highest since mid-2022 this week, while stockpiles in Europe are well below seasonal levels.
Despite the hostilities in the Middle East, some crude shipments continue to exit the Persian Gulf through Hormuz, with US officials this week pointing to robust regional flows. Saudi Arabia also kept the price of its flagship crude unchanged for next month, potentially signaling that market tightness has eased.
Before the Iran war, about a fifth of the world’s oil and liquefied natural gas was shipped through Hormuz to global markets. Spot LNG prices in Asia rallied to the highest in more than three years this week, with elevated costs weighing on the demand and budgets of some countries in the region.
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This article was generated from an automated news agency feed without modifications to text.
