Oil prices rebounded on Friday after United States President Donald Trump renewed threats against Iran, raising concerns that escalating tensions with the major Middle Eastern producer could disrupt global crude supplies.
By 3:30 pm AEDT (4:30 am GMT), Brent crude futures for March delivery were up 48 cents, or 0.8%, at $64.54 per barrel. U.S. West Texas Intermediate crude also rose 48 cents, or 0.8%, to $59.84 per barrel.
The rebound followed losses of about 2% in the previous session. Prices recovered after Trump told reporters aboard Air Force One that the United States had an “armada” heading toward Iran, while adding that he hoped it would not be used.
The comments came as he renewed warnings to Tehran over the killing of protesters and any move to restart its nuclear programme.
A U.S. official said warships, including an aircraft carrier and guided missile destroyers, are expected to arrive in the Middle East in the coming days.
Iran is the fourth-largest producer within the Organization of the Petroleum Exporting Countries and a key supplier to China, the world’s second-largest oil consumer.
Both Brent and WTI were on track for weekly gains of around 0.6%. Prices had climbed earlier in the week on Trump’s threats to invade Greenland, which risked destabilising the transatlantic alliance, before retreating on Thursday as he stepped back from the prospect of military action.
Trump later said Denmark, which controls the Arctic island, along with NATO and the United States, had reached a deal allowing “total access” to Greenland, easing immediate geopolitical concerns.
Oil prices also faced pressure on Thursday from bearish U.S. government data showing a rise in crude stockpiles amid slowing fuel demand.
The U.S. Energy Information Administration reported that crude inventories increased by 3.6 million barrels in the week ended 16 January, exceeding the 1.7 million-barrel rise expected.
The increase also surpassed the 3 million-barrel build reported by market sources citing the American Petroleum Institute earlier in the week.
Both reports were released a day later than usual due to the Martin Luther King Jr. holiday in the United States.
