By: Economy Middle east

Oil prices climbed on Friday amid concerns of renewed military tensions in the Middle East, after Iran released footage showing commandos boarding a cargo vessel in the Strait of Hormuz and reports indicated its air defenses had engaged “hostile targets.”

As of 4:05 GMT, Brent crude futures increased by 91 cents, or 0.87 percent, reaching $106 per barrel, while West Texas Intermediate futures rose 75 cents, or 0.78 percent, to $96.60 a barrel.

Oil prices were on track for strong weekly gains as tensions between the U.S. and Iran remained elevated, while disruptions to supply through the Strait of Hormuz persisted with little sign of easing. Both benchmark contracts were up roughly 15 percent to 18 percent over the week.

Tensions rise as U.S.-Iran talks stall

Oil prices closed more than 3 percent higher on Thursday, surging by about $5 per barrel following reports that air defenses were intercepting targets over Tehran, alongside signs of internal tensions between Iran’s hardline and moderate factions.

U.S. President Donald Trump said Iran may have slightly increased its military readiness during the two-week ceasefire, but noted that U.S. forces could neutralize it within a single day.

“Even though the U.S. has extended the ceasefire, talks have stalled, and Iran is firm on its stance of keeping the Strait closed, which is keeping prices elevated. Global demand remains strong, as shown by U.S. crude and product exports reaching record levels amid buyers seeking alternative supply sources,” said Vijay Valecha, Chief Investment Officer, Century Financial.

On Thursday, Iran also released footage showing commandos in a speedboat boarding a large cargo vessel following the breakdown of peace talks, highlighting its control over the Strait of Hormuz, a key route that typically carries around 20 percent of the world’s oil and gas supply.

Concerns over prolonged U.S.-Iran conflict emerge

As global investors and governments seek a lasting resolution, Trump said he would not impose a set timeline for ending the conflict with Iran, emphasizing his aim to secure “a great deal.”

“Don’t rush me,” he said when asked how long he was prepared to wait for a long-term agreement with Tehran.

Trump also reiterated his claims that the United States had severely weakened Iran’s military capabilities and left the country in disarray. His remarks heightened concerns about a prolonged U.S.-Iran conflict, which could further disrupt oil flows from the Middle East and keep supply uncertainty and prices elevated.

Trump also said in a social media post on Thursday that Israel and Lebanon had agreed to extend their ceasefire by three weeks following a high-level meeting between officials from both sides at the White House. Prior to that announcement, Israel had signaled it was prepared to resume strikes on Iran.