Oil prices climbed in Asian trading on Friday, heading for their strongest weekly gains since July as renewed United States-Iran hostilities and rising tensions heightened concerns over Middle East supply risks.
By 3:55 pm AEST (5:55 am GMT), Brent crude futures were flat at $95.52 per barrel, while U.S. West Texas Intermediate (WTI) crude futures gained 25 cents, or 0.3%, to $91.55 per barrel.
For the week so far, Brent was up 8.6%, while WTI had gained 9.9%, putting both benchmarks on track for their strongest weekly advances since the week ended 20 July.
ANZ analysts commented in a note to clients:
"The risk of the conflict widening and impacting alternate routes for oil to reach the international market also rose. Israel indicated that it was prepared to return to fighting if necessary and that an Iranian attack on the Jewish state would free it from any existing restrictions.
"The market also heard conflicting messages on the longevity of the recent fighting. President Trump suggested the U.S. bombing campaign wouldn’t last too long.
"However, a Reuters report earlier this week suggested White House officials are consider ramping up military action after the 3 November mid-term elections. Such a move would have a significant impact on the recovery phase of oil from the Persian Gulf.
"The oil market has been operating under the assumption that the impact of the conflict on oil flows has peaked and that a peace deal would eventually see exports back to normal before the year’s end.
"The prosect of an extended conflict will keep the oil flow constrained for the foreseeable future."
Meanwhile, U.S. Vice President JD Vance told reporters on Thursday that Washington does not plan to hold talks with Iran unless Tehran stops attacking commercial shipping in the Strait of Hormuz.
Capping oil's gains, however, Russian President Vladimir Putin said there remained a path to a deal to end the war in Ukraine, adding that both the U.S. and China were prepared to support a peace settlement.
