Oil prices set for second weekly decline as Trump to stay with Iran blockade
“Oil prices were mixed on Friday, but set for their second weekly decline, as the US plans to continue its Iranian blockade, reducing the chance of renewed large-scale fighting that could disrupt Midd…”
Brent futures were little changed, down 1 cent at $95.41 a barrel at 0242 GMT. West Texas Intermediate (WTI) declined by 20 cents, or 0.25%, to $88.52 a barrel.
Friday's declines reversed two days of gains amid a volatile trading week with earlier hopes for a rapprochement of the US-Israel war against Iran, now in its ninth month, offset by strikes on Saudi Arabian infrastructure by Yemen’s Iran-backed Houthis and attacks on tankers transporting crude out of the Gulf.
Despite the swings in prices amid the inconclusive war, Brent is set for a 2.4% drop this week, after plunging 16% the previous week, while WTI is set for a 2.5% decline, after dropping 13% previously.
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Prices slipped on Friday after US President Donald Trump said on Truth Social a deal with Iran was not necessary to end the war, indicating he will stick with the blockade on oil shipments and trade and economic sanctions.
The overall decline in prices over the past two weeks reflects a good assessment of the risks to the market, said Chris Brankin, global advisor for Melbourne-based brokerage Mi. Trade.
"I think the oil market is priced to perfection at this point," he said, adding that prices have bounced back a bit but without much conviction on the part of traders, which shows they are following closely what is happening in the Middle East.
Despite the easing prices, risks remain for oil shipments out of the Strait of Hormuz, the key waterway for crude exports from the main Middle East producers. On Thursday, Iran's military said four oil tankers were hit by explosions in the Strait of Hormuz after ignoring warnings.
Reuters could not immediately verify the Iranian accounts. That same day, Yemen's Iran-aligned Houthis said they had attacked a pumping station on the Saudi East-West oil pipeline; an oil facility in the Saudi Red Sea city of Yanbu; and an Aramco building in the capital Riyadh.
Also pressuring prices, US crude and fuel inventories rose last week, driven by softer refined products demand and a jump in oil imports, the Energy Information Administration said on Thursday.
Crude inventories rose by 4.7 million barrels to 414.4 million barrels in the week ended November 6, the EIA said, compared with analysts' expectations in a Reuters poll for a 1.1 million-barrel draw.
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