Oil Prices Decline as Truce Hopes Clash with Saudi Arabia Risks

Oil prices took a hit on Friday as markets weighed the possibility of a truce between the US and Iran against the ongoing threat to oil assets in Saudi Arabia. The Brent crude price fell by $0.87, or 0.82%, to $105.73 per barrel at 0212 GMT, while West Texas Intermediate (WTI) dropped by $1.56, or 1.65%, to $93.05 per barrel.

Just a week ago, oil prices had surged to a one-week high on Thursday, with Brent rising as much as 5% and WTI up by 2.7%. The spread between Brent and WTI is the widest it has been since May at $12.68, reflecting different regional risk profiles.

US and Iranian negotiators are exploring a phased path out of war that would involve Tehran reopening the Strait of Hormuz and Washington lifting its economic blockade of Iran. Saudi Arabia intercepted six ballistic missiles fired by Yemen's Iran-backed Houthis on Thursday, highlighting the ongoing threat to oil assets in the region.