Oil prices climbed on Friday as traders assessed the potential for renewed US military action against Iran, raising concerns over Middle Eastern supply disruptions. Brent futures for December delivery settled at $117.64 a barrel, marking a fourth consecutive monthly gain. Meanwhile, West Texas Intermediate (WTI) closed at $104.12 a barrel, though gains were pared after US President Donald Trump mentioned ongoing peace talks, suggesting there was still time for diplomacy.
The uncertainty stems from Trump's repeated threats to resume airstrikes on Iran following next week's midterm elections. Diplomatic efforts have so far failed to resolve the conflict in the Persian Gulf and the Strait of Hormuz, a critical energy checkpoint. Despite regional attempts to revive negotiations, senior Iranian officials have indicated that Tehran will not compromise its positions on ending the war.
Recent hostilities in the Strait of Hormuz have included two separate tanker attacks, further fueling supply concerns. Brent prices have surged in October, reaching a six-month high, even as oil flows through Hormuz have partially recovered. US Central Command reported helping Gulf partners export 1.5 billion barrels of crude oil since the summer.
Traders are closely watching next week's US midterm elections, which could influence the trajectory of the conflict. The Trump administration has taken steps to address soaring fuel costs, including awarding contracts for nearly 41 million barrels from the nation's emergency reserve. In Israel, Prime Minister Benjamin Netanyahu's allies secured 53 seats in the general election, though this falls short of a majority, prolonging uncertainty over the conflict with Iran.