Key facts
- Brent crude fell 0.69% to $105.85 a barrel at 0032 GMT on Friday.
- West Texas Intermediate (WTI) fell 0.86% to $93.80 a barrel.
- US and Iranian negotiators are exploring a phased path out of war.
- Saudi Arabia intercepted six ballistic missiles fired by Yemen's Iran-backed Houthis.
- Around a fifth of the world’s oil and gas shipments have been curtailed since the war began.
Oil prices experienced a slight decline on Friday as market participants weighed the potential for a truce between the US and Iran against recent Houthi attacks on Saudi oil facilities. Brent crude was down 0.69% to $105.85 a barrel, and West Texas Intermediate (WTI) fell 0.86% to $93.80 a barrel at 0032 GMT.
This followed a volatile week where prices had risen to a one-week high. On Thursday, both Brent and WTI contracts saw gains of up to 5%, with Brent settling 3.4% higher and WTI up 2.7%. Brent reached its highest close since September 15, while WTI, which had fallen 13% over the prior six sessions, ended the week up 2.09% compared to Brent's 6.42% rise.
Sources close to the talks indicated that US and Iranian negotiators in New York are exploring a phased approach to de-escalate tensions, which could involve Tehran reopening the Strait of Hormuz and Washington lifting its economic blockade of Iran. "Diplomatic hopes are essentially helping oil prices weather the latest military strikes in the Middle East, with crude trading moderately softer despite the attacks," said Tim Waterer, chief analyst at KCM Trade.
Since the conflict began in late February, approximately one-fifth of global oil and gas shipments have been curtailed, contributing to a 50% price increase in March alone and prompting liquefied natural gas buyers to seek alternative, stable supplies. Iranian President Masoud Pezeshkian stated on Thursday that the decision to end the conflict rests with the US. Meanwhile, the Saudi-led coalition in Yemen reported that Saudi Arabia intercepted six ballistic missiles launched by Iran-backed Houthis, thwarting attacks on the Taif province and the Red Sea area of Yanbu. "Ongoing attacks serve as a clear reminder that critical oil assets remain firmly in the firing line," Waterer added. Industry sources, satellite imagery, and shipping data suggest Saudi Arabia is increasing crude pumping volumes through its East-West Pipeline to its Red Sea export hub of Yanbu, though crude tanker loadings have not yet resumed.