Oil prices on Friday were headed for their sharpest weekly fall since March 2023, as the absence of significant supply disruptions due to the Iran-Israel conflict led to the evaporation of any risk premium, UNN writes with reference to Reuters.
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Brent crude futures rose 36 cents, or 0.53%, to $68.09 a barrel by 06:37 GMT (09:37 Kyiv time), while U.S. West Texas Intermediate crude rose 33 cents, or 0.51%, to $65.57. This put both benchmarks on course for an approximate 12% weekly decline.
Both benchmarks have now returned to the levels they were at before Israel initiated the conflict by firing missiles at Iranian military and nuclear facilities on June 13, the publication notes.
This week began with prices reaching a five-month high after the US attacked Iranian nuclear facilities over the weekend, and then falling to their lowest level of the week on Tuesday when US President Donald Trump announced a ceasefire between Iran and Israel.
Currently, traders and analysts have said they see no significant impact of the crisis on oil flows.
"Absent the threat of a significant supply disruption, we continue to believe that oil supplies are essentially excessive, and our 2025 balances indicate a surplus of approximately 2.1 million barrels per day," Macquarie analysts wrote in a research note on Thursday.
Analysts predict that the average price for WTI will be around $67 per barrel this year and $60 next year, increasing each forecast by $2 after factoring in a geopolitical risk premium.
The small price rally at the end of the week occurred when US government data showed oil and fuel inventories a week earlier, as well as an increase in refining activity and demand.
"The market is starting to realize the fact that oil inventories have suddenly become very tight," said Phil Flynn, senior analyst at Price Futures Group.
Prices were also supported by a Wall Street Journal report that Trump plans to name the next head of the Federal Reserve earlier. This led to new bets on US interest rate cuts, which typically stimulate oil demand.