Oil prices rose on Friday, recovering some of the sharp losses from the previous session, after Hezbollah rejected a new Lebanon ceasefire proposal and Oman's Mina al Fahal terminal suspended oil loadings following an explosion near its berths.
Brent and WTI Crude Futures
Brent crude futures increased by 33 cents, or 0.35%, to $95.36 a barrel by 0408 GMT, after settling down 2.84% in the previous session. Meanwhile, US West Texas Intermediate crude was at $93.06 a barrel, up 2 cents, or 0.02%, following a 3.1% loss on Thursday. Both contracts are on track to post their first weekly gain in three weeks, with WTI up more than 6%, amid heightened Middle East tensions and ongoing US-Iran war-peace talks.
Supply Disruptions and Geopolitical Tensions
Reuters reported on Friday that Oman's Mina al Fahal terminal suspended oil loadings after an explosion near its single-buoy mooring (SBM) berths, allegedly caused by a drone attack. Hezbollah leader Naim Qassem rejected a US-brokered agreement between Israel and the Lebanese government to halt the fighting on Thursday. Iran has made a ceasefire in Lebanon a condition for any peace deal with Washington.
Market Analysis and Outlook
Analysts have flagged concerns about falling global oil inventories, which could cause a price spike in the third quarter. IG market analyst Tony Sycamore noted that any optimism remains clouded by conflicting headlines, but from a technical perspective, as long as WTI crude remains above trendline support in the low $80s, risks are skewed to the upside. OPEC Secretary General Haitham Al Ghais reaffirmed on Thursday that the organization sticks to its oil demand growth forecast of 1.2 million barrels per day for this year, despite the Middle East conflict and the closure of the Strait of Hormuz.
Iranian oil exports have fallen to their lowest level in six years, mainly due to the US naval blockade, according to shipping data, although weak demand in China has depressed prices for Iranian oil.
