Oil prices pushed higher on Friday as fresh worries over supply disruptions in Saudi Arabia combined with ongoing restrictions on tanker movements through the Strait of Hormuz.
Despite the gains, crude was still on course for a weekly decline as market tensions eased somewhat following a fragile two-week ceasefire between the United States and Iran. Sentiment also improved after Israel signalled a possible diplomatic opening, indicating it was prepared to begin direct discussions with Lebanon.
Brent crude futures climbed 96 cents, or 1%, to $96.88 per barrel at 06:04 GMT, while U.S. West Texas Intermediate rose 78 cents, or 0.80%, to $98.65 per barrel.
Even with Friday’s increase, both benchmarks have fallen around 11% so far this week, marking their steepest weekly drop since June 2025, when earlier Israeli-U.S. military operations against Iran were paused.
Recent strikes on Saudi energy infrastructure have reduced the kingdom’s oil production capacity by approximately 600,000 barrels per day and cut flows through the East-West Pipeline by roughly 700,000 barrels per day, according to Saudi state news agency SPA, citing an Energy Ministry source.
Analysts at ANZ said the developments have heightened fears of additional supply disruptions in global oil markets.
At the same time, shipping through the Strait of Hormuz remains severely limited, with volumes still below 10% of normal levels despite the ceasefire. Iran has reinforced its grip on the passage by requiring vessels to remain within its territorial waters during transit.
Although Iran and the U.S. agreed earlier in the week to a two-week ceasefire brokered by Pakistan, clashes have continued since the announcement.
Analysts suggest Pakistan may seek to facilitate a longer-term peace agreement, though it may lack the leverage needed to ensure the full reopening of the critical shipping corridor.
Iran has also floated the idea of imposing transit fees on vessels using the strait as part of any broader peace settlement, a proposal that has drawn opposition from Western governments and international maritime authorities.
The Strait of Hormuz, a key artery for global oil and gas flows, has effectively been constrained since the conflict began on February 28, when the U.S. and Israel launched coordinated airstrikes on Iran.
John Paisie, president of Stratas Advisors, said Brent prices could surge to as high as $190 per barrel if current restrictions on shipping flows persist.
“If Iran allows increasing flows the price of oil will be more moderated, but still well above pre-war levels.”
Mukesh Sahdev, founder and CEO of XAnalysts, noted that the “key variable now is how flows through the Strait of Hormuz actually resume – not whether they reopen.”
Since the conflict began, roughly 50 infrastructure assets across the Gulf have been hit by drone and missile attacks, while about 2.4 million barrels per day of refining capacity have been taken offline, according to JPMorgan.
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