Oil futures fell sharply on Friday 24 July, but both Brent and West Texas Intermediate (WTI) remained set for their largest weekly gains since May.
The market continued to respond to ongoing disruptions in the Red Sea and concerns about broader instability across oil-producing regions.
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Brent crude futures had dropped by almost $4, or 3.96%, to $96.70 a barrel (bbl) as of 09:46 GMT, following a session in which prices rose above $100/bbl for the first time since May, reported Reuters.
Despite Friday’s retreat, Brent was heading for a 9.7% gain across the week.
WTI futures decreased by $3.15, or 3.42%, to $89.04/bbl, and was also on track for a substantial weekly advance of approximately 8%.
Market tensions heightened during the week as Iran-aligned Houthi forces claimed responsibility for attacks on two Saudi oil tankers in the Red Sea, raising the risk in a key global transit route.
Prior to this, on 20 July, the Houthis announced a naval blockade of Saudi Arabia and have been pressured by Iran to shut the Bab el-Mandeb strait if US strikes on Iranian infrastructure continue.
Bab el-Mandeb is said to be the world’s second most critical energy route after the Strait of Hormuz.
Shipping activity in the region has reflected heightened geopolitical risks. Kpler data showed transits through the Strait of Hormuz were steady at three per day over the past three days.
On Thursday, two vessels, including the empty Noble very large crude carrier, entered the Gulf through the strait.
At Bab el-Mandeb, commodity vessel crossings increased to 32 on 23 July, up from 26 the previous day, according to Kpler. Two crossings had been recorded on 24 July by the time of reporting.
Meanwhile, Russia claimed that its military had targeted Ukrainian Black Sea ports, facilities and fuel reserves overnight.
Separately, Kazakhstan curtailed oil production after suspected Ukrainian drone strikes temporarily closed its main export terminal.
Amid these ongoing disruptions, Opec+ oil-producing nations are expected to consider a further increase in production targets when ministers meet on 2 August, Reuters reported.
According to three sources cited by the news agency, Opec+ is likely to raise group targets for September by around 188,000 barrels per day, mirroring the increases set for June, July and August.
The seven Opec+ members expected to implement the output rise are Algeria, Iraq, Kazakhstan, Kuwait, Oman, Russia and Saudi Arabia.
