During Asian trading on Friday, oil prices experienced an upward trend following statements from U.S. President Donald Trump indicating that a military fleet is en route to Iran. This development heightened anxieties over possible disturbances in Middle Eastern oil supplies.
Crude oil, despite earlier setbacks in the week, is poised to register gains for the fifth consecutive week. This is attributed to analysts’ expectations of a demand recovery alongside the market incorporating increased risk premiums due to escalating geopolitical tensions globally.
By 22:48 ET (03:48 GMT), Brent crude futures for March delivery had surged by 0.9% to $64.62 per barrel, while West Texas Intermediate (WTI) crude futures rose by 0.9% to $59.89 per barrel.
President Trump addressed reporters on Thursday evening aboard Air Force One, revealing that the U.S. has assembled a naval armada moving toward Iran. He cautioned Iran not to suppress protestors violently or to resume its nuclear activities.
"We have an armada... heading in that direction, and maybe we won’t have to use it," Trump stated, adding, "I’d rather not see anything happen, but we’re watching them very closely." Subsequent reports indicate that the deployment includes an aircraft carrier supported by multiple destroyers expected to arrive in the Middle East imminently.
Iran plays a significant role in global oil markets as one of the largest producers within OPEC and as a major supplier to China's oil imports. Any military intervention by the U.S. would likely result in disruptions to Iran’s oil output and exports.
Earlier in January, Iran faced nation-wide demonstrations against the government, with reports indicating thousands of casualties during the unrest. These internal disruptions further complicate the geopolitical landscape affecting oil supply.
This week, oil prices fluctuated moderately, trading between 0.6% and 0.8% increases after a volatile period in the market amid attention also focused on the U.S.' changing diplomatic stance on Greenland.
Supportive factors for oil prices include mildly positive economic growth figures from China and a revised upward demand forecast for 2026 issued by the International Energy Agency. These elements have contributed to optimism among investors.
Additionally, the U.S. dollar weakness has provided further tailwinds for crude prices, as market participants anticipate potential Federal Reserve interest rate cuts later in the year.