Oil prices headed for their strongest weekly gain since April on Friday, as the escalating conflict between the US and Iran heightened fears of supply disruptions across some of the world's most critical energy shipping routes.
Brent crude traded near $85 a barrel, putting the global benchmark on course for a weekly gain of almost 12%, while West Texas Intermediate (WTI) climbed above $79 a barrel.
The latest gains came after the US launched another round of attacks on Iran on Thursday, a day after strikes reportedly hit an oil tanker near the country's main export terminal. Adding to market jitters, Reuters reported that Tehran had instructed Yemen's Houthi rebels to close the Bab el-Mandeb Strait—a crucial gateway to the Red Sea for Saudi Arabia's oil exports—if Iranian power infrastructure comes under attack.
The renewed escalation has revived concerns over crude flows through the Strait of Hormuz, the narrow waterway that carries roughly 20% of global oil supplies. The prospect of disruptions has pushed crude prices close to a one-month high, reversing part of the sharp decline seen during the second quarter.
The impact is also being felt beyond crude markets. Fuel markets in both the US and Europe are showing signs of exceptional tightness, with refining margins for diesel and gasoline climbing to record levels. That squeeze has been compounded by lower Russian fuel exports after Ukrainian attacks on refineries prompted Moscow to restrict diesel shipments.
Shipping activity through Hormuz remains under close watch. While visible tanker traffic has slowed sharply amid heightened security risks, some exports continue via ship-to-ship transfers off the coast of Oman. Traders are also monitoring whether those alternative routes remain viable after Iran earlier this week targeted vessels involved in transporting crude from the United Arab Emirates.
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