Oil futures pared gains on Friday, but continued for the week as President Biden sought to prevent Tel Aviv from attacking Iranian oil facilities following Iran’s recent missile attack on Israel. It was the biggest increase in more than a year.
West Texas Intermediate (CL=F) rose less than 1% to settle at $74.38 a barrel after soaring as much as 2.5% during trading. U.S. crude oil futures still ended the week up more than 9%, the best week since March 2023.
Brent crude oil (BZ=F), the international standard price, also rose by less than 1% on Friday, settling at $78.09 per barrel.
Oil prices pared gains after President Biden commented on whether Israel’s oil infrastructure would be targeted in Israel’s retaliation against Iran.
“If I were in their shoes, I would consider alternatives to attacking the oil fields,” Biden told reporters at the White House on Friday afternoon.
Friday’s move comes after it soared more than 5% on Thursday as the president reacted to a possible attack on Iran’s oil infrastructure, which currently supplies more than 3 million barrels of oil per day.
Asked if he supported targeting oil facilities, Biden said: “We’re discussing that.”
Later that day, a Pentagon spokesperson said at a briefing that the US was talking with Israel about “what the response to Iran would be,” but did not provide further details about the targets.
Analysts at JPMorgan said Friday morning that the White House is unlikely to support attacks on Iranian oil facilities, given the U.S. presidential election is a month away and the administration wants to avoid a spike in oil prices. said.
“This is therefore not an action preferred by Israel, but rather a secondary or tertiary response to possible Iranian escalation,” JPMorgan analysts Natasha Kaneva and Prateik Kedia said in a note Friday. We assume that it will be.”
An oil platform from the Leviathan gas field off the coast of Israel is seen during an Israeli naval ship patrolling the Mediterranean Sea on Friday, September 20, 2024. (AP Photo/Ariel Shalit) (ASSOCIATED PRESS)
Concerns over possible disruptions along the Middle East’s Strait of Hormuz, a choke point for crude oil shipments, also pushed prices higher.
“If there’s a chokehold there and there’s severe traffic congestion or significant delays, you have to clear $80.” [Brent]. If that happens, oil prices will rise significantly. Itโs a game changer,โ Blue Line Futures founder Bill Baruch told Yahoo Finance this week.
Futures soared on Tuesday after Iran fired around 200 ballistic missiles in response to Israeli ground air strikes in southern Lebanon targeting Iranian-backed militants.
โThe positioning in crude oil leading up to these events is very short and many [week’s] This move is short covering and not necessarily investors betting that oil prices will continue to rise,” Rebecca Babin, senior U.S. energy trader at CIBC Private Wealth, told Yahoo Finance on Friday. Ta.
story continues
Despite this week’s gains, excess production capacity in the oil alliance OPEC+ may be keeping prices relatively subdued.
Last week, futures markets surged after reports that Saudi Arabia, leader of the Organization of the Petroleum Exporting Countries, is determined to begin lifting voluntary production cuts later this year, even if it leads to lower oil prices. fell.
Ines Ferre is a senior business reporter at Yahoo Finance. Follow her on Twitter @ines_ferre.
For the latest stock market news and in-depth analysis of price-moving events, click here
Read the latest financial and business news from Yahoo Finance