Oil Posts Weekly Gains; US-Iran Conflict Keeps Supply Risks in Focus
Oil prices ended the week higher following a lack of progress in resolving the conflict between the United States and Iran. The energy market remains overshadowed by geopolitical uncertainty, particularly after Washington opted to intensify economic pressure on Tehran rather than launch a major military operation.
WTI contracts closed 0.3% higher at US$87.06 per barrel, marking a weekly gain of 6.9%. Meanwhile, Brent rose 0.7% to US$94.39 per barrel, posting a weekly increase of approximately 6.6%. This rally represents one of the strongest weekly gains in recent times as investors continue to price in the risk of supply disruptions from the Middle East.
Although the conflict remains a primary driver of oil prices, the market is beginning to show a more muted response to geopolitical tensions. Linh Tran of XS.com notes that the mere continuation of the conflict no longer triggers the same price spikes seen previously, as market participants have already factored in some of the associated risks.
Investors now require more significant developments to spark the next major price move—such as a fresh escalation that genuinely threatens the flow of oil from the Middle East. Market focus remains fixed on the US's next moves regarding Iran, particularly concerning economic sanctions that could impact Tehran's energy exports.
Newsmaker Analysis: Oil retains a bullish bias in the short term, as the geopolitical risk premium remains high and supply uncertainties persist. Brent holding above US$94 indicates continued buyer dominance, with the psychological level of US$95 serving as the next key threshold. However, in the absence of further escalation and should diplomatic avenues open up, the market could see profit-taking following a rally of over 6% in a single week.
Source: Newsmaker.id
