In New York, oil prices climbed early in Asian trading on Friday, marking a third consecutive weekly increase. The uptick is driven by concerns over supply disruptions stemming from rising geopolitical tensions and weather-related issues, despite indications of weaker demand.
Brent crude futures for August delivery, expiring Friday, edged up 15 cents to $86.54 per barrel by 0020 GMT. The September contract also rose by 0.2% to $85.44 per barrel. Meanwhile, US West Texas Intermediate crude futures for August delivery increased by 24 cents to $81.98 per barrel.
Amidst signs of reduced demand from the US, the world’s largest oil consumer, prices surged higher amidst escalating tensions between Israel and Lebanon’s Hezbollah. The potential escalation in the Middle East conflict could involve major oil exporter Iran.
On the international front, France voiced concern over Lebanon’s situation, while Turkey expressed solidarity and called for regional support.
In addition to geopolitical concerns, the US Gulf Coast faces potential weather disruptions, with the National Hurricane Center monitoring a weather system that could intensify into a cyclone and affect the region’s energy infrastructure.
Despite these supply risks, Brent and WTI futures have seen a 1.5% weekly gain.
On the demand side, US crude inventories unexpectedly rose this week, reflecting weakened gasoline consumption. However, anticipation of robust travel during the July 4th weekend in the US may bolster gasoline demand and draw down inventories.
