Oil prices experienced a minor dip on Friday, with Brent crude futures down 0.8% and U.S. West Texas Intermediate futures down 0.89%. However, both benchmarks are on track for monthly gains, with Brent crude closing above $93 a barrel for the first time since July 24. The recent increase in oil prices follows U.S.
Treasury Secretary Scott Bessent's announcement of the 'toughest sanctions in history' against Iran, aligning with President Trump's threats of severe economic measures. This hardening stance from Washington has raised concerns about the future of shipping through the Strait of Hormuz, where vessel traffic remains low due to ongoing tensions and attacks.
Janiv Shah from Rystad Energy noted that the oil market is now reflecting a failure of diplomatic efforts, which could lead to significant impacts on refined products, particularly diesel, as supply shortages and high demand continue to pressure the market.
The situation suggests that while crude prices may fluctuate, refined product markets are likely to experience more pronounced effects due to refinery constraints and energy security issues