WTI Holds Near Monthly High on Mideast Tensions

Key Moments

WTI Holds in Range as Weekly Gains Build

West Texas Intermediate (WTI), the primary US crude oil benchmark, edges higher in Asian trading on Friday but continues to move within a well-defined, multi-day range. The contract is quoted near $79.35, marking a 0.50% gain on the session and trading close to the one-month high set on Tuesday. Price action suggests WTI is on track to post a second consecutive weekly advance as markets weigh the risk of a deeper confrontation between the United States and Iran.

Escalating US-Iran Tensions Underpin Risk Premium

Support for crude is being driven in large part by heightened geopolitical tensions. The US military conducted a sixth straight night of air strikes against Iran on Thursday and hit an empty oil tanker bound for Kharg Island as part of what is described as a renewed naval blockade on Iranian ports. In parallel, Iran launched attacks on US military facilities across the region, stoking concerns over a potential slide back into full-scale conflict and reinforcing the geopolitical risk premium embedded in oil prices.

Officials in Bandar Abbas, in southern Iran, reported that civilian sites, including power infrastructure and a train station, have been struck. In addition, Iran’s Islamic Revolutionary Guard Corps had previously warned of a broader escalation by threatening to target more regional energy supply routes. Reuters reported that Iran has asked Yemen’s Houthis to be prepared to shut the Red Sea oil route, introducing what is characterized as a potent new threat to global energy flows.

Shipping Disruptions Bolster Bullish Bias

The combination of a reported decline in vessel movements through the Strait of Hormuz and the potential for Red Sea disruptions is providing additional support to crude prices. These developments are underpinning expectations that oil could extend its advance if geopolitical risks intensify further.

Even so, from a tactical standpoint, market participants may prefer to see continued buying interest and a decisive break above the recent multi-day range before adding significant new long exposure. At the same time, the broader fundamental setting implied by current events suggests that any price dips are likely to attract buyers and remain relatively well supported.

Current WTI Market Snapshot