Key Highlights
- Brent crude advanced 1.7% to reach $106.88 per barrel; WTI climbed 1.4% to $97.21 per barrel during Friday trading
- Both oil benchmarks heading toward their most substantial weekly increase since the beginning of March
- The strategic Strait of Hormuz continues to operate at near-zero capacity, eliminating approximately 20% of worldwide oil shipments
- President Trump indicated no urgency to finalize a lasting agreement with Iran, increasing market volatility
- Goldman Sachs projects Persian Gulf production has dropped by approximately 14.5 million barrels daily, representing over half of April’s regional output
Energy markets experienced significant upward momentum on Friday following President Donald Trump’s declaration that he sees no immediate need to conclude the current U.S.-Iran confrontation, injecting additional volatility into already turbulent oil markets.
Brent crude futures advanced 1.7% to settle at $106.88 per barrel. Meanwhile, U.S. West Texas Intermediate crude increased 1.4% to land at $97.21 per barrel. Both oil benchmarks are tracking toward their most significant weekly advance since the beginning of March.
These price movements occur as the Strait of Hormuz — a critical chokepoint along Iran’s southern coastline — continues operating at nearly zero capacity for oil tanker passage. Approximately 20% of the world’s petroleum supplies typically transit through this vital maritime corridor.
The strategic waterway has been essentially impassable for multiple weeks. Leading Gulf oil exporters such as Saudi Arabia and Qatar have been investigating alternate transportation pathways, though none have successfully compensated for the disruption.
Iranian forces detained vessels that attempted passage through the strait during the current week. American military personnel also intercepted a supertanker transporting Iranian petroleum in the Indian Ocean as the Navy intensified its embargo of Iranian maritime facilities.
During Thursday, Trump announced via Truth Social that he had directed the U.S. Navy to engage and destroy any Iranian naval vessels discovered deploying underwater explosives in the strait. In response, Iran broadcast footage showing its special forces boarding a commercial vessel and highlighted its rapid-attack boat arsenal.
Diplomatic Efforts Remain Frozen
Attempts to restart diplomatic dialogue continue to face obstacles. Two American government sources with knowledge of the situation informed Bloomberg that Trump’s social media declarations and the active naval embargo have hindered mediation efforts led by nations such as Pakistan.
Trump informed journalists on Thursday that he preferred not to accelerate progress toward a comprehensive agreement, asserting the United States had severely degraded Iran’s armed forces and that the nation was experiencing internal chaos.
A temporary ceasefire arrangement between the United States and Iran received an indefinite extension earlier this week, though petroleum markets demonstrated minimal reassurance from this development. The Lebanon-Israel cessation of hostilities also received a three-week extension after diplomatic discussions in Washington.
A U.S.-sanctioned oil supertanker transporting Iranian crude was observed apparently trying to navigate the Strait of Hormuz on Friday, while general tanker movement through the passage remains virtually nonexistent.
Goldman Projects Extended Supply Constraints
Goldman Sachs researchers, led by Daan Struyven, stated in an April 23 analysis that Persian Gulf petroleum production might require “several months” to substantially normalize — and that projection assumes complete Hormuz reopening without additional military strikes.
The financial institution calculates that Gulf production has decreased by approximately 14.5 million barrels daily, representing more than half of the region’s April supply capacity.
“Oil is climbing primarily due to the tangible supply disruption rather than merely geopolitical risk speculation,” explained Charu Chanana, chief investment strategist at Saxo Markets. “While warfare concerns may be slightly diminishing, the transportation bottleneck persists.”
Mona Yacoubian from the Center for Strategic and International Studies observed the disruption is becoming impossible to dismiss. “The extended duration of this situation makes it increasingly apparent that the destabilizing consequences of this confrontation will persist for months, potentially longer,” she commented.
Brent crude was positioned for a weekly increase of approximately 17% as of Friday morning.
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