Oil Prices Head for Biggest Weekly Surge Since 2022 Ukraine Invasion
Crude oil was headed on Friday for its sharpest weekly gain since Russia launched its full-scale invasion of Ukraine in February 2022, as conflict in the Middle East kept shipping and energy exports through the vital Strait of Hormuz blocked.
Brent crude futures have surged 20% this week, while West Texas Intermediate has jumped 25%.
On Friday, Brent extended its climb and was up $2.09, or 2.45%, to $87.50 per barrel at 0953 GMT. WTI rose $3.76, or 4.64%, to $84.77. Both benchmarks traded at their highest levels since July 2024.
$150 A BARREL?
Qatar’s energy minister told the Financial Times he expects all Gulf energy producers to shut down exports within weeks, a move he said could drive oil to $150 a barrel, according to an interview published on Friday.
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Oil started its steep rally after the U.S. and Israel launched strikes on Iran on Saturday, prompting Tehran to stop tankers moving through the Strait of Hormuz, which handles roughly one-fifth of global daily oil supply.
The conflict has since spread across the Middle East’s key energy-producing areas, disrupting output and forcing shutdowns of refineries and liquefied natural gas plants.
“With every passing day, halted activities in Hormuz will have two major impacts on oil: the inability to store 20 million barrels per day and the lack of flow to the world, which could drive global energy prices higher,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.
U.S. President Donald Trump told Reuters in an exclusive interview on Thursday that he was not concerned about rising U.S. gasoline prices linked to the conflict, saying “if they rise, they rise” and that the U.S. military operation was his priority.
A White House official said the U.S. Treasury Department is expected to announce measures to combat rising energy prices from the conflict, a prospect that briefly pushed prices down by more than 1% earlier on Friday.
Losses narrowed after Bloomberg News reported that the Trump administration had ruled out using the Treasury Department to trade oil futures for now.
The Treasury on Thursday granted waivers for companies to buy sanctioned Russian oil stored on tankers to ease supply constraints that have forced refineries in Asia to cut fuel processing.
The first waivers went to Indian refiners, who have since bought millions of barrels of Russian crude, reversing months of pressure on them to halt the purchases.
Ship-tracking firm Kpler estimates about 30 million barrels of Russian oil are available and loaded on vessels in the Indian Ocean, Arabian Sea region and Singapore Strait, including volumes in floating storage.
Still, the recent rise in prices is relatively mild compared with earlier shocks such as in 2022, when Russia’s attack on Ukraine pushed oil above $100 a barrel.
“It’s important to put this move into perspective: despite crude’s almost 20% surge this month, the price is currently just $3.40 above its average over the last four years,” IG analyst Tony Sycamore said.
Reporting by Anna Hirtenstein in London. Additional reporting by Helen Clark in Perth and Sudarshan Varadhan in Singapore. Editing by Kevin Buckland and Mark Potter
This article was first reported by Reuters
