Brent crude surged above $93 per barrel on Friday, marking a second consecutive weekly gain as escalating US-Iran tensions over the Strait of Hormuz continued to roil global energy markets.
The international benchmark closed at over $93 a barrel on Thursday for the first time since July 24, while West Texas Intermediate traded near $87. Both contracts posted their strongest weekly performance in several weeks as traders priced in renewed threats to one of the worlds most critical energy chokepoints.
Iran Escalation Drives Prices Higher
The surge came as President Trump warned of an economic D-Day against Iran, promising the most crushing economic operation ever taken against any country. Tehran responded by declaring that any nation joining US sanctions would be considered an enemy, further complicating diplomatic efforts to resolve the six-month conflict.
The US has reimposed a naval blockade on Iranian ports while Iran has threatened to restrict traffic through the Strait of Hormuz, which handles roughly one-fifth of global oil supply. Market analysts at ANZ noted the firm US stance against Iran, with the blockade back in place and threats of tougher sanctions on Iranian oil exports, is the primary driver of prices back above $90 a barrel.
Central Banks Face Policy Dilemma
The sustained oil price surge has forced central banks worldwide to reassess their monetary policy outlook. The Federal Reserve, Bank of England and European Central Bank have all signaled caution as energy costs feed through to broader inflation. Markets now expect the ECB to hike rates this year, a sharp reversal from earlier forecasts of easing.
Gold continued its advance alongside oil, with futures rising to over $4,637 an ounce as investors sought safe-haven assets amid geopolitical uncertainty. The dollar weakened modestly against a basket of major currencies.
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