Key Highlights
- Brent crude advanced 1.7% to $106.88 per barrel; WTI climbed 1.4% to $97.21 on Friday’s trading session
- Both oil benchmarks heading toward their strongest weekly performance since the first week of March
- Critical Strait of Hormuz waterway continues near-total closure, blocking approximately 20% of worldwide oil shipments
- President Trump indicated patience regarding permanent Iran settlement, extending market volatility
- Goldman Sachs projects Persian Gulf production down approximately 14.5 million barrels daily, exceeding 50% reduction in April
Energy markets experienced significant upward momentum Friday following President Donald Trump’s statements that he sees no immediate need to conclude the current U.S.-Iran standoff, injecting additional volatility into already turbulent commodity markets.
Brent crude futures advanced 1.7% to settle at $106.88 per barrel. Meanwhile, U.S. West Texas Intermediate climbed 1.4% to close at $97.21 per barrel. Both major oil benchmarks are tracking toward their most substantial weekly gains since the opening week of March.
The price surge follows weeks of disruption at the Strait of Hormuz — a critical chokepoint along Iran’s southern coastline — which has remained essentially impassable to commercial tanker vessels. Roughly 20% of the world’s petroleum passes through this narrow channel under normal conditions.
The strategic waterway has been effectively sealed for multiple weeks. Leading Gulf oil exporters such as Saudi Arabia and Qatar have attempted to establish alternative shipping lanes, though none have successfully compensated for the blocked passage.
Tehran’s forces intercepted multiple vessels that attempted passage through the strait during the past week. Simultaneously, American military personnel commandeered a supertanker transporting Iranian crude in the Indian Ocean as naval forces intensified their embargo of Iranian maritime facilities.
Thursday saw Trump announce via Truth Social that he had authorized U.S. Naval commanders to “shoot and kill” any Iranian craft discovered deploying naval mines within the strait. Iran responded by broadcasting footage of its special forces boarding a commercial vessel and highlighting its rapid-attack boat fleet.
Diplomatic Resolution Efforts Stalled
Attempts to restart diplomatic channels have reached an impasse. Two American officials with knowledge of the situation informed Bloomberg that Trump’s Truth Social statements combined with the active naval embargo have hindered mediation efforts led by nations including Pakistan.
Trump addressed media representatives Thursday, expressing his reluctance to expedite a lasting agreement, noting that U.S. military operations had severely degraded Iranian armed forces and left the nation destabilized.
A temporary ceasefire arrangement between Washington and Tehran received an indefinite extension earlier this week, though energy traders showed minimal confidence in its durability. The Lebanon-Israel cessation of hostilities also gained a three-week extension following diplomatic discussions in the U.S. capital.
A sanctioned supertanker laden with Iranian petroleum was observed Friday apparently making an attempt to navigate the Strait of Hormuz, even as commercial tanker movement through the passage remains virtually nonexistent.
Goldman Projects Extended Supply Constraints
Goldman Sachs commodity analysts, led by Daan Struyven, stated in an April 23 research note that Persian Gulf petroleum production might require “a few months” to approach normal levels — contingent on complete Hormuz reopening and absence of renewed military action.
The investment bank calculates that Gulf region output has declined by approximately 14.5 million barrels each day, representing more than half of the region’s typical April production volume.
“Oil is rising more because of the physical supply shock rather than a geopolitical risk premium alone,” said Charu Chanana, chief investment strategist at Saxo Markets. “The war risk may be fading at the margin, but the flow risk has not gone away.”
Mona Yacoubian of the Center for Strategic and International Studies noted the disruption is proving hard to ignore. “The longer this continues, the more it becomes clear that the disruptive effects of this conflict are going to reverberate for months, if not longer,” she said.
Brent crude was positioned for approximately 17% weekly appreciation as of Friday’s morning trading session.
