Oil Prices Slide Amid Fed Hints and Hormuz Rumors

Oil prices settled lower on Friday, ending the week in the red. Brent crude futures settled at $89.31 a barrel, down 39 cents or 0.43%, while West Texas Intermediate crude futures finished at $83.40 a barrel, down 13 cents or 0.16%. The weekly decline was attributed to hints about the US Federal Reserve Bank's inflation-fighting policy and rumors of a possible agreement on shipping through the Strait of Hormuz.

Following comments by new Fed Chairman Kevin Warsh suggesting a rate hike later this year to curb inflation, oil prices descended further, according to Phil Flynn, senior analyst at Price Futures Group. 'The global products markets are looking strong on further Ukraine strikes on Russian refineries,' Flynn said. 'But there is a lot of rumbling, rumors we might see a deal to reopen the Strait of Hormuz over the weekend.'

The US-Israeli war with Iran entered its sixth month on Friday, and traders were watching as flows of oil through the strait made a choppy recovery. Janiv Shah, Rystad analyst, said that 'the market has been surprised by the additional flow, Iran-Oman shipping corridor and the U.S. mine clearance claims.'

Despite the tensions, officials in President Donald Trump's administration are working on a deal to secure long-term access to a portion of Venezuela's crude reserves. This move could ultimately lower the cost of oil imports.