Trump's Threats Keep Oil Markets on Edge Amid Ongoing Mideast Tensions

Crude oil prices pulled back on Friday after a significant weekly rally, but the supply risk trade remains alive thanks to ongoing tensions in the Middle East. The situation has not changed since Iran restricted Hormuz and the Houthis attacked Saudi tankers near Bab el-Mandeb this week. This has put pressure on both the Gulf and Red Sea routes, affecting Saudi exports which were already declining before the blockade. President Trump's promise of major military punishment for Iran and the Houthis after the tanker attacks adds to the uncertainty.

The weekend is expected to be a volatile period for crude positioning as the conflict continues to escalate. The fuel markets are running at record margins, supporting crude prices despite the recent pullback. With two chokepoints impaired in the region, Saudi exports and global supply chains remain under threat.