Tensions with Iran Fuel Oil Price Surge as Supply Risks Persist

Oil prices are on track for a weekly gain of about 4% as tensions between the US and Iran persist, keeping supply risks elevated. At the current rate, Brent crude is trading at $87.84 per barrel, while West Texas Intermediate stands at $82.45 per barrel.

The geopolitical risk has offset pressure from rising US inventories, which saw a 17.4 million-barrel increase last week. However, the inventory build has done little to ease concerns over physical crude availability as the conflict between Washington and Tehran continues to disrupt shipping through key Middle Eastern waterways.

Despite weaker demand expectations from major energy agencies, including the International Energy Agency's forecast of a 1.6 million-barrel-per-day decline in global oil demand for the current quarter, prices remain supported by supply disruptions.