Oil prices increased on Friday, 14 August, after the US warned it could impose an indefinite naval blockade on Iran, heightening concerns about crude supply disruptions in the Middle East.
This followed a drop in oil prices the previous day, attributed to a weaker demand forecast and a significant increase in US crude inventories, reported Reuters.
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As of 06:53GMT, Brent crude futures rose by $0.90, or 1.03%, to $87.97 a barrel.
Meanwhile, US West Texas Intermediate (WTI) crude was up $0.91 at $82.16 per barrel.
Both benchmarks were set for weekly gains of around 4%, despite having shed more than 2% in the previous session, which interrupted multi-day rallies for both contracts.
Tensions escalated after the US government said on Thursday it could continue its naval blockade of Iranian waters and intensify economic pressure on Tehran, reported Reuters.
The move comes amid stalled ceasefire negotiations and declining global oil supply and rising regional tensions.
Defence Secretary Pete Hegseth told reporters that the US military is capable of maintaining a naval presence to enforce the blockade, which he said has had a severe economic impact on Iran.
The Strait of Hormuz, through which approximately 20% of the world’s oil previously passed, has seen a fall in shipping traffic.
On Tuesday, only eight vessels transited the waterway, down from an average of 12 over the prior ten days and significantly lower than the pre-war average of 130 to 140.
Iran has tightened its control over the strait, attacking several ships and seeking to use the passage as leverage in its standoff with the US.
The US lifted its blockade on Iran’s shipping for a month in June but has since reinstated it, restricting Tehran’s access to hard currency and compounding damage from earlier strikes on Iranian energy infrastructure.
Meanwhile, the state-owned Abu Dhabi National Oil Company (ADNOC) confirmed that two of its vessels were attacked while passing through the Strait of Hormuz on Thursday, with no injuries, reported Reuters.
The UAE government attributed the attack to Iran, marking the second incident involving ADNOC in under a week.
Elsewhere, Russian authorities responded to a fire at the Baltic Sea oil export hub Ust-Luga on Friday, which the regional governor said was caused by a Ukrainian drone attack.
