Oil Surges on Geopolitical Tensions, US-Iran Conflict

The price of oil surged on Friday, posting its biggest weekly gain since July. WTI crude settled at $91.48 per barrel, up $0.18 or 0.20% from Thursday's settlement. This represents a weekly increase of nearly 10%, with Brent crude gaining 7.6%. The main driver behind this surge was the renewed U.S.-Iran military conflict, which has rebuilt the geopolitical risk premium in oil markets.

The Strait of Hormuz remains congested, with only four visible commodity vessels crossing on Thursday compared to an average of 15 over the past decade. This uncertainty has contributed to higher prices, despite falling U.S. crude inventories and exceptionally tight diesel markets.

Analysts warn that unless the conflict de-escalates and tanker traffic improves consistently, oil prices could remain high next week. The Federal Reserve's interest rate decision is also expected to influence petroleum demand.