Oil Prices Set for Second Weekly Gain as US Threatens Iranian Sanctions
Oil prices were steady on Friday and were on track for a second straight weekly gain after the United States threatened to impose the toughest sanctions in history with no end in sight for disruptions to Middle East oil flows.
Brent crude futures rose 20 cents, or 0.21%, to $93.98 a barrel by 1307 GMT. U.S. West Texas Intermediate crude was up 7 cents, or 0.08%, at $86.90.
The Brent benchmark has gained more than 6.1% while WTI has risen 5.3% this week, with both touching their highest since July 24 in the previous session.
"The U.S. is taking a very firm stance against Iran, with the blockade back in place and threats of tougher sanctions on Iranian oil exports, and that's why we are seeing oil prices back above $90 a barrel," said ANZ analyst Soni Kumari.
Iran said on Friday that its response to any new U.S. threats would be "devastating" after Washington pledged to impose the toughest financial penalties in history with the aim of toppling the Iranian leadership.
"The immediate impact on supply may be limited as Iranian exports are already heavily constrained by the U.S. naval blockade," said Crispus Nyaga, research analyst at Empire FX.
"However, an increase in shipping incidents and retaliation against economic sanctions could exacerbate the current situation at a time when traffic through the Strait of Hormuz remains well below normal levels."
Oil prices have climbed on concerns over the continued curtailment of supply from major oil producers such as Saudi Arabia, Iraq, the United Arab Emirates and Kuwait.
The earlier peace deal between the U.S. and Iran expired this week with no effort by either side to restart talks.
Offers of Iranian crude to Chinese buyers have declined and prices have jumped this week as the U.S. blockade cuts Iran's shipments, trade sources said, with the threat of more sanctions from Washington looming.
SUPPLY DISRUPTION CONTINUES
Seven commodity ships sailed along the Strait of Hormuz on Thursday, which was only half the previous day's tally, data from ship-tracker Kpler showed.
Before the U.S.-Israeli attacks on Iran began in late February, the Strait of Hormuz handled about a fifth of global oil and liquefied natural gas supplies. As the war approaches the six-month mark, disruptions to energy flows through the waterway remain in place.
Elsewhere, Ukraine's military hit a Russian oil refinery in the city of Perm overnight, more than 1,600 km (1,000 miles) from the Ukrainian border, President Volodymyr Zelenskiy said on Friday.
(Reuters)
