Oil prices rose by about 2 per cent on Friday on growing supply worries linked to intensifying protests in oil-producing Iran and an escalation of attacks in Russia’s war in Ukraine.
Brent futures appreciated by $1.35 or 2.18 per cent to $63.34 per barrel, while the US West Texas Intermediate (WTI) futures were up by $1.36 or 2.35 per cent to $59.12. For the week, Brent grew by about 4 per cent, while WTI gained about 3 per cent.
Worries over potential disruption of Iran’s oil output grew as the civil unrest in the Middle Eastern country, which is a member of the Organisation of the Petroleum Exporting Countries (OPEC), intensified.
President Donald Trump said on Thursday that Iran’s leader, Ayatollah Ali Khamenei, was planning on fleeing the country following the protests in the OPEC producer demanding a change in regime.
The Ayatollah is “looking to go someplace”, President Trump told reporters who asked for comment on reports that the Iranian leader could escape to Russia.
On Friday, Iran cut off Internet, as the regime frequently does amid protests in the autocratic country over economic hardships.
The action continued in the capital Tehran as well as in major cities of Mashhad and Isfahan and other areas around the country.
The protests that began nearly two weeks ago have left about 40 people dead and 2,000 have been detained as Iranian forces are trying to suppress the widespread protests.
The Ayatollah on Friday slammed the protests and protesters, accusing them of being “vandals” acting on behalf of President Trump.
In a televised address and amid the Internet blackout, Khamenei vowed that the Islamic Republic would “not back down” to protesters and President Trump.
A survey showed that OPEC pumped 28.40 million barrels per day last month, down 100,000 barrels per day from November’s revised total, with troubled Iran and Venezuela posting the largest declines.
The Russia-Ukraine war also added to supply worries as the Russian military said on Friday it had fired its hypersonic Oreshnik missile at targets in Ukraine. The targets included energy infrastructure supporting Ukraine’s military-industrial complex.
Despite these, global oil inventories are rising and oversupply remains the main driver that could cap gains.
The US moved to push a Venezuela oil deal to US energy companies including Chevron, ExxonMobil, ConocoPhillips, Halliburton, Valero, Marathon, Shell, Vitol, Trafigura, Repsol, Eni, and others, with President Trump saying the agreement would generate “tremendous wealth” for the industry and “great wealth” for the American people.