Oil prices fell a few cents on Friday, near six-month highs, investors are focused on US-Iran tensions
Oil prices are poised for their highest monthly gains since 2022. Oil prices fell a few cents a barrel on Friday, consolidating recent gains and continuing to trade near six-month highs, supported by ongoing tensions between the US and Iran.
Brent crude futures closed down 2 cents, or 0.03%, at $70.69 a barrel. WTI crude closed down 21 cents, or 0.32%, at $65.21 a barrel.
The market had priced in much of the geopolitical risk to Iran, but at this point, the market is difficult to gauge. The question is, is Iran really the target? Will there be action against Iran? Or will sanctions force Iran to retreat? Where does China fit into all this?
Oil prices reached their highest level since early August on Thursday. Many sources say that US President Donald Trump is considering actions against Iran, including targeted strikes, raising concerns about supply disruptions.
Both the US and Iran say they are willing to engage in dialogue, but Iran says its defense capabilities are not up for discussion. They are standing their ground.
Gains have stalled due to the possibility of a cold truce between Russia and Ukraine and the possibility that an attack on Iran might not happen, with the Trump administration opening the door to talks on Iran's nuclear program.
The US, which has strengthened its military presence in the Middle East in recent weeks, imposed new sanctions targeting seven Iranian citizens and at least one entity.
The rise in the dollar after hitting four-year lows earlier in the week put some pressure on oil prices. Friday's dollar strengthening came after Trump announced he would appoint former Federal Reserve Chairman Kevin Warsh to head the US central bank after Jerome Powell's term ends in May.
A stronger dollar could limit demand from oil buyers who pay in other currencies.
Increased oil production in the U.S. and Kazakhstan's near-resumption of production at the Tengiz oil field are also contributing to the shift in sentiment.
Meanwhile, Russia is expected to have its peak maintenance periods at primary oil refineries this year in this month and September.
Most analysts expect prices to hover around $60 per barrel this year, as the possibility of a supply surplus offsets potential disruptions stemming from geopolitical tensions.
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
