Oil Closes at Its Highest Since 2022 as Markets Price in a Prolonged War
Global oil benchmarks settled at their highest levels since mid-2022 as fears of further escalation in the Iran war grew and expectations for a quick resolution remained low. Brent closed above $112 a barrel, taking weekly gains to about 9%, while the Strait of Hormuz—through which roughly 20% of global oil normally transits—remained all but closed.
Signs of continued conflict intensified on Friday. CBS News reported that Pentagon officials have been preparing options for a potential deployment of U.S. ground troops into Iran. The report, citing unnamed sources, said it remains an option and it was unclear under what circumstances President Donald Trump would authorize such an operation.
Meanwhile, U.S. officials said the White House is sending hundreds of Marines to the Middle East as it weighs a plan to seize Iran’s Kharg Island oil export hub. Even a limited troop presence inside Iran would carry significant risks for Trump and could trigger retaliation from Tehran, including attacks on critical energy infrastructure—an outcome that markets fear could deepen the supply shock.
Oil also drew support from a Bloomberg report that Iranian officials have become increasingly reluctant to even discuss reopening the Strait of Hormuz, focusing instead on surviving the U.S.-Israeli onslaught. “Crude is closing out another volatile, headline-driven week, with strength into the weekend as traders trim short exposure,” said Rebecca Babin, a senior energy trader at CIBC Private Wealth. She added that the move higher reflects worsening rhetoric from Iran, limited evidence of meaningful flows through the Strait, and unconfirmed reports that Kharg Island could be in play alongside increased military positioning across the region.
Positioning data suggests traders are leaning more bullish. Weekly ICE Futures Europe figures (as of Tuesday) showed money managers increased their net-long Brent crude positions by 77,672 to 428,704, marking the strongest bullish stance in more than six years.
Brent has risen nearly 50% this month as the war approaches the end of its third week. The near-total closure of Hormuz has stranded supplies in the Persian Gulf and forced leading OPEC producers to curb output. Iran continued strikes on Gulf neighbors even as Israeli Prime Minister Benjamin Netanyahu pledged to refrain from targeting Iran’s energy facilities, while Trump sought to de-escalate attacks on oil and gas assets—again criticizing NATO allies for not joining the war or helping to unblock the Strait.
Earlier this week, a strike on Iran’s South Pars gas field was followed by Tehran’s retaliation against multiple key facilities across the region, sending crude and European natural gas prices sharply higher as officials raced to contain the fallout.
At the close, Brent for May settlement rose 3.3% to $112.19 a barrel, the highest since July 2022. WTI for May delivery gained 2.8% to settle at $98.23 a barrel. The less-active April contract, which expired Friday, rose 2.3% to $98.32 a barrel.
Source : Newsmaker.id
