Oil Prices Structure Shift on Escalating Middle East Rift
Reversing trend, US West Texas Intermediate crude grade surpassed Brent prices as the oil supply outlook worsened due to the escalating Middle East conflict.
Oil prices were flat on Friday, as Brent and WTI crude futures traded little amid markets closed for the Good Friday holiday leading up to Easter Sunday.
West Texas Intermediate (WTI) crude surged more than 10% while Brent crude jumped nearly 8% on Thursday following US President Donald Trump’s threat to escalate the war with Iran.
The international benchmark Brent crude rose to $109.74 before settling at $109.24 per barrel on Thursday. West Texas Intermediate (WTI) crude also advanced, briefly climbing to $113.93, before closing the session at $111.54 per barrel.
News regarding the US/Israel and Iran conflict remained in focus for the market throughout the week. Reports that Iran is working with Oman on a protocol to monitor shipping traffic in the Strait of Hormuz partially eased market concerns following US President Donald Trump’s remarks that attacks on Iran would intensify if no deal is reached.
Meanwhile, market players are also focused on the upcoming OPEC+ meeting, which comprises the Organisation of the Petroleum Exporting Countries (OPEC) and some non-OPEC producers. Eight OPEC+ member countries are scheduled to meet on Sunday.
Trump said late Wednesday that the US is “nearing completion” of its military objectives in Iran but warned that the US will “hit them extremely hard over the next two to three weeks.”
“We’re going to bring them back to the Stone Ages, where they belong,” he said.
Regional tensions have escalated since Feb. 28, when the US and Israel launched coordinated strikes on Iran. Iran has retaliated with drone and missile strikes targeting Israel and Gulf countries that are home to US military assets.
Saudi Arabia, the United Arab Emirates, and Bahrain reported new attacks from Iran on Thursday, with air defenses intercepting dozens of missiles and drones as regional escalation continues to expand.
