NEW YORK: Oil futures climbed on Friday as investors tracked heightened U.S.-Iran tensions and fresh warnings from President Donald Trump, adding a geopolitical risk premium to crude prices. Brent crude traded around $71.27 a barrel and U.S. West Texas Intermediate near $66.06, leaving both benchmarks up about 5% for the week and on course for their first weekly gain in three weeks. The moves kept prices near six-month highs after sharp advances in the previous sessions.
The latest gains followed a series of developments tied to security in key shipping lanes for energy exports. Iran this week temporarily restricted navigation in parts of the Strait of Hormuz for several hours during military drills, according to Iranian media and regional maritime notices. The waterway, which links the Persian Gulf to the Gulf of Oman, is a major conduit for seaborne crude and refined products, making any disruption a focal point for oil traders.
Diplomatic and military signals also remained in focus. Trump said Iran had 10 to 15 days to reach a nuclear agreement with the United States and warned of “really bad things” if a deal was not achieved, speaking in Washington at a meeting of his administration’s Board of Peace. Iranian officials said Tehran would not initiate a conflict but would respond if attacked, and Iran’s mission to the United Nations warned in a letter that U.S. bases and assets in the region would be considered targets in self-defense.
Market risk premium widens
In energy markets, the standoff has coincided with increased activity in crude derivatives. Market data showed heavier demand this week for Brent call options, contracts that gain value when prices rise, as traders sought protection or upside exposure during the latest round of headlines. Brent and WTI also posted strong settlements on Thursday, with both benchmarks ending that session close to their highest levels in about six months, reflecting persistent sensitivity to official statements and regional security updates.
Fundamentals added support alongside geopolitics. The U.S. Energy Information Administration reported that commercial crude inventories fell by 9.0 million barrels to 419.8 million barrels in the week ended Feb. 13. Refinery inputs averaged 16.1 million barrels per day and utilization rose to 91.0% of operable capacity. The agency also reported declines in gasoline stocks of 3.2 million barrels and distillate inventories of 4.6 million barrels, while total commercial petroleum inventories dropped by 19.1 million barrels.
Supply outlook remains in focus
Oil prices also reflected shifting expectations for global supply as producers weigh output plans for the spring. The OPEC+ alliance has been discussing the possibility of beginning production increases from April under its existing schedule, a prospect that traders monitor closely as it can influence balances later in the year. At the same time, the market has been responding to signs of tighter near-term availability, including inventory draws in the United States and heightened attention to export flows through the Gulf.
By the end of the week, the focus remained on confirmed developments that can move crude prices quickly, including official comments on nuclear talks, military activity near vital waterways, and government inventory data. The Strait of Hormuz remains central to that calculus because a significant share of the world’s seaborne oil passes through the route, keeping energy markets highly responsive to shipping advisories and regional security announcements. – By Content Syndication Services.