Oil prices showed little change on Friday, maintaining their trajectory for weekly gains as tensions persist in the Middle East. Brent crude futures dipped 0.1% to $81.57 a barrel, while U.S. West Texas Intermediate crude futures rose 0.03% to $76.24 a barrel.
The ongoing conflict in the Middle East, particularly Israel’s rejection of a ceasefire offer from Hamas, has kept oil prices elevated. Brent and WTI are both set to gain more than 5% for the week.
Although Thursday saw both benchmarks rise about 3% following Israeli airstrikes in the southern border city of Rafah, analysts suggest the market’s reaction may have been excessive given the limited impact on fundamentals. The rangebound trading pattern is expected to persist.
While the tensions in the Middle East have influenced oil prices, there has been no direct impact on oil production. Additionally, concerns about deflation risks in China, the world’s leading crude oil importer, are putting pressure on global oil prices.
Notably, the U.S. Treasury Department sanctioned three entities based in the United Arab Emirates and one tanker registered by Liberia for violating a cap on the price of Russian oil imposed by a coalition of Western nations.