Oil prices fell in Asian trading on Friday, extending losses from the previous session as concerns over supply disruptions eased after the likelihood of a U.S. military strike on Iran diminished.
Brent crude was down 21 cents, or 0.3%, at $63.55 per barrel, while U.S. West Texas Intermediate (WTI) slipped 15 cents, or 0.3%, to $59.04 per barrel at 0418 GMT.
Both benchmarks had climbed to multi-month highs earlier in the week after protests erupted in Iran and U.S. President Donald Trump signaled the possibility of military action. Despite Friday’s pullback, Brent remained on track for a fourth consecutive weekly gain.
Sentiment shifted late Thursday after Trump said Tehran’s crackdown on protesters was easing, reducing fears of imminent military strikes that could disrupt oil supplies. As a result, prices gave back earlier gains, though they remain higher than a week ago, according to BMI analysts.
“Given the potential political upheaval in Iran, oil prices are likely to experience greater volatility as markets digest the risk of supply disruptions,” BMI noted.
However, analysts remain cautious about the longer-term outlook, pointing to expectations of ample supply this year despite OPEC’s earlier view of a broadly balanced market.
“Sentiment is driving markets, but the impact of headlines is always short-lived, especially when fundamentals look comfortable,” said Priyanka Sachdeva, senior market analyst at Phillip Nova. She added that unless there is a meaningful recovery in Chinese demand or a physical supply bottleneck, oil prices are likely to stay range-bound, with Brent broadly trading between $57 and $67.
On Wednesday, OPEC reiterated that oil supply and demand would remain balanced in 2026, with demand growth in 2027 expected to match this year’s pace. Meanwhile, Shell released its 2026 Energy Security Scenarios, striking a more bullish tone and estimating that global primary energy demand could be 25% higher by 2050 compared with last year.
