Oil Prices Slip Despite Rising Tensions and Increased Flows

Oil prices fell on Friday but remained on track for a monthly rise of about 20%, despite rising Middle East tensions.

Brent futures dropped $1.44, or 1.6%, to $87.59 a barrel by 0658 GMT, while US West Texas Intermediate (WTI) crude slipped $1.59, or 1.9%, to $82 a barrel.

The decline in oil prices was offset by increased flows through the Strait of Hormuz, a key maritime chokepoint, according to Daniel Hynes, a senior commodity analyst at ANZ.

Hynes noted that while tanker traffic has continued through the strait and Red Sea, higher security risks have boosted freight costs and insurance premiums, embedding a significant geopolitical risk premium in oil prices.