Global oil prices settled higher on Friday as uncertainty surrounding U.S.-Iran negotiations renewed concerns over disruptions to energy shipments through the Strait of Hormuz, a critical artery for global crude exports.
Brent crude futures closed at $103.54 per barrel, gaining 96 cents or 0.94%, while U.S. West Texas Intermediate (WTI) crude settled at $96.60 per barrel, up 25 cents or 0.26%. Both benchmarks had surged more than 3% earlier in the trading session before trimming gains.
Despite Friday’s rebound, crude prices remained volatile over the week, with Brent posting a 5.48% weekly decline and WTI falling 8.37%, reflecting shifting market expectations over the prospects of a diplomatic breakthrough between Washington and Tehran.
Energy markets have been closely monitoring negotiations aimed at easing tensions and restoring normal shipping operations through the Strait of Hormuz, which previously handled roughly 20% of global energy flows before the conflict disrupted exports.
Analysts said investors remain highly sensitive to conflicting signals emerging from the talks.
“We have so many headlines back and forth, it’s hard to keep up,” said Phil Flynn, senior analyst at Price Futures Group. “The story now is Iran will deliver the uranium for the lifting of sanctions. But they keep changing the news before the ink is dry.”
Diplomatic activity intensified on Friday, with Pakistan and Qatar reportedly stepping up mediation efforts. Iran’s state news agency IRNA reported that Pakistan’s army chief had travelled to Tehran, while a source familiar with the discussions said a Qatari delegation also arrived in the Iranian capital in coordination with Washington.
U.S. Secretary of State Marco Rubio acknowledged incremental progress following NATO meetings in Sweden but cautioned that major issues remain unresolved.
“There’s been some progress. I wouldn’t exaggerate it. I wouldn’t diminish it,” Rubio told reporters. “There’s more work to be done. We’re not there yet.”
According to diplomatic sources, disagreements persist over Iran’s uranium stockpile and future controls related to the Strait of Hormuz.
Market participants said the absence of clarity continues to drive sharp swings in crude prices.
“I think we’re very much subject to the headlines,” said John Kilduff, partner at Again Capital. “We seem headed for a resolution, but the level of clarity is spectacularly low.”
Supply concerns have intensified as reduced tanker flows through the Strait of Hormuz continue to tighten global inventories. Analysts estimate the conflict has temporarily removed nearly 14 million barrels per day from the market — equivalent to about 14% of global oil supply — including exports from Saudi Arabia, Iraq, the United Arab Emirates and Kuwait.
Tamas Varga, analyst at PVM Oil Associates, said global stockpiles are depleting rapidly as shipping volumes through the strait slow significantly.
However, expectations of an eventual diplomatic settlement have prevented prices from moving substantially higher.
“The optimism of a relatively imminent truce and bearish rhetoric whenever Brent approaches $110 prevents oil prices from rallying significantly higher,” Varga said.
The prolonged supply uncertainty is also heightening concerns about inflationary pressures and global economic growth, particularly for energy-importing economies already facing elevated fuel and transport costs.
Reflecting tighter market fundamentals, BMI, a unit of Fitch Solutions, raised its 2026 Brent crude forecast to an average of $90 per barrel from $81.50, citing ongoing supply deficits, damage to Gulf energy infrastructure and an expected six- to eight-week post-conflict recovery period.
