Crude oil futures rose on Friday due to global supply shortages caused by the closure of the Strait of Hormuz
Crude oil futures rose on Friday due to the closure of the Strait of Hormuz, with news of ongoing conflict affecting prices. Producers are seeking measures to ease the supply shortage.
May Brent futures closed up $2.68, or 2.67%, at $103.14 a barrel. April WTI closed up $2.98, or 3.11%, at $98.71 a barrel.
Prices fell early Friday due to erroneous reports that an Indian-flagged tanker had passed through the Strait of Hormuz, which has been closed since the start of the war. However, prices began to rise after it became clear that the tanker had departed from Oman and had not passed through the strait, and were on a positive note before noon.
Brent oil was up 11.27% from its March 6 closing price, while WTI oil gained 8% from its value a week earlier.
As part of its efforts to lower prices, the US has given countries a 30-day grace period to purchase Russian oil and petroleum products stranded at sea, as a step to stabilize global energy markets shaken by the US-Israel war against Iran.
According to Russia, this will affect 100 million barrels of Russian crude oil, which is roughly equivalent to a day's global production.
In fact, Russian oil was already going to buyers; this doesn't bring additional products to the market but reduces some friction. It contributes to Russia's enrichment.
The market is very worried that this war will last longer. The biggest fear is that there will be serious damage to oil infrastructure, leading to a permanent loss of supply.
The US Department of Energy announced that Washington will release 172 million barrels of oil from the Strategic Petroleum Reserve to help curb rising oil prices.
This plan was coordinated with the International Energy Agency (IEA), which agreed to release a record 400 million barrels of oil from strategic reserves, including a U.S. contribution.
However, the temporary relief triggered by the IEA's release was shattered by a renewed escalation of risks in the Middle East.
Iran's new Supreme Leader, Ayatollah Mojtaba Khamenei, said Iran would continue the fight and keep the Strait of Hormuz closed as a bargaining chip against the U.S. and Israel.
Trump said on Thursday that the U.S. would make significant profits from rising oil prices due to a war with Iran. However, he stated that preventing Iran from acquiring nuclear weapons was far more important.
On Thursday, both benchmark prices rose more than 9%, reaching their highest levels since August 2022.
Related Articles
Oil prices are rising as supply concerns increase amid expectations of a prolonged conflict in the Middle East
Oil prices continued to rise following US and Iranian attacks on ships serving their respective purposes
Oil prices closed higher this week following renewed US-Iran hostilities
