Oil prices slipped during Asian trading on Friday but quickly recovered most of their initial declines, as persistent concerns about supply disruptions linked to the U.S.-Israel conflict with Iran continued to dominate market sentiment.
Prices had earlier dropped by nearly 1% after the United States said it would allow the purchase of Russian crude already in transit, a move intended to ease supply pressures caused by the Iran conflict.
However, crude soon pared much of the drop and remained on track for a second straight week of solid gains, with the ongoing conflict in Iran — the main catalyst behind the latest surge in oil — showing few signs of easing.
By 02:17 ET (06:17 GMT), Brent crude futures for May were down 0.1% at $100.34 per barrel, while West Texas Intermediate (WTI) crude futures declined 0.4% to $94.05 per barrel.
U.S. greenlights purchases of Russian oil already at sea
Late on Thursday, the U.S. Treasury issued a 30-day waiver permitting countries to buy Russian crude shipments that had already been loaded onto tankers before March 12.
Treasury Secretary Scott Bessent said the measure was designed to help stabilize global energy markets amid supply disruptions stemming from the war with Iran.
Earlier in the week, Washington had also granted limited exemptions allowing the continued purchase of Russian oil, including shipments bound for India, the world’s third-largest crude importer.
The move comes as tensions surrounding Iran remain high, with the United States also signaling it could release large volumes of oil from its Strategic Petroleum Reserve to soften potential supply shocks.
Earlier reports suggested the International Energy Agency is preparing a record emergency release of more than 400 million barrels from strategic reserves to help offset the impact of the Iran conflict.
Oil still poised for strong weekly gains as conflict drags on
Despite the modest pullback on Friday, both Brent and WTI were still set to post weekly gains of roughly 7% to 9%, extending the sharp rally sparked by escalating tensions.
Crude prices had already surged nearly 30% in the previous week.
The conflict entered its fourteenth day on Friday, with the United States and Israel continuing strikes on Iranian targets while Tehran responded with waves of missile and drone attacks against oil infrastructure across several neighboring Middle Eastern countries.
Iran has also threatened to shut down the Strait of Hormuz, a crucial global oil shipping lane, in an attempt to pressure Washington and its allies.
The potential closure of the strait — combined with attacks on energy infrastructure — has intensified fears of longer-term disruptions to global oil supplies. The passage is especially critical because roughly 20% of global oil consumption moves through the waterway.
“The conflict has now moved beyond a short-lived geopolitical shock and into a phase where supply losses are increasingly structural rather than transient,” ANZ analysts wrote in a note.
“Price volatility is likely to remain high, but the skew is increasingly to the upside. Importantly, the longer the disruption persists, the higher the price required to restore market balances.”
Investors remain cautious about the possibility of a prolonged surge in oil prices, as higher energy costs could fuel inflation and push major central banks toward a more hawkish policy stance.
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