Market Overview
Oil prices retreated in Asian trade on Friday, with Brent crude futures slipping 0.5% to $93.29 a barrel and West Texas Intermediate (WTI) futures dropping 0.6% to $84.34 a barrel by 20:38 ET (00:38 GMT). Despite the pull‑back, the market is on track for a weekly gain of more than 5%, marking a second straight week of strong upward momentum.
Geopolitical Drivers
The price movement follows the United States' announcement that it will impose its strictest ever economic sanctions on Iran. President Donald Trump pledged to use “the toughest sanctions in history” to pressure Tehran into accepting a nuclear deal and warned countries that continue to support Iran. Treasury Secretary Scott Bessent reiterated the administration’s stance on Thursday, emphasizing the unprecedented nature of the sanctions.
Regional Responses
Iran rejected the new U.S. threats, a stance echoed by China, a major purchaser of Iranian crude. The specific details of the forthcoming sanctions remain unclear, as the United States already enforces restrictions on Iran’s oil exports and maintains a naval blockade imposed earlier in the year.
Shipping and Trade Impact
Commercial traffic through the Strait of Hormuz, a critical chokepoint for global oil shipments, remains at a fraction of pre‑war levels despite U.S. claims to the contrary. Iran signaled it will keep the waterway closed until the United States complies with the terms of a preliminary peace agreement signed in June.
Outlook
While the immediate price dip reflects short‑term market reaction to the sanctions announcement, the broader weekly trajectory suggests continued bullish pressure as the U.S.–Iran standoff persists.