Oil prices saw a resurgence on Friday, with Brent crude rising 1.9% to $104.52 per barrel and U.S. West Texas Intermediate futures increasing by 1.5% to $97.81 per barrel. This rally follows a period of decline and is largely influenced by mixed signals regarding the Iran peace deal negotiations. While U.S.
President Donald Trump indicated that negotiations were nearing completion, Iranian Supreme Leader Ayatollah Mojtaba Khamenei's directive to retain enriched uranium within Iran has raised concerns about a prolonged conflict and continued disruptions to oil supplies.
The International Energy Agency (IEA) has warned that as summer travel demand increases, oil markets could soon enter a 'red zone' due to depleting global stocks. IEA Executive Director Fatih Birol emphasized that the reopening of the Strait of Hormuz is crucial to alleviating the energy crisis, as this waterway is vital for global oil and liquefied natural gas transport.
Additionally, a note from MUFG highlighted that full normalization of Middle East oil supply may not occur until 2027, reflecting the significant disruptions caused by the ongoing conflict. This situation underscores the importance of geopolitical stability in the oil market and its direct impact on prices and supply chains