Crude oil prices on Friday came down but remained on track for weekly gains as investors stayed cautious over US-Iran tensions.
Brent crude futures for August dropped nearly 6 cents, or 0.08 per cent, to US$76.24 a barrel, while U.S. West Texas Intermediate (WTI) crude declined 4 cents, or 0.06 per cent, to US$72.04.
Despite the pullback, both Brent and WTI were on course to gain approximately 6 per cent and 5 per cent for the week, respectively.
Investor sentiment, despite the prevailing tensions, remains relatively strong after mediators reportedly made several phone calls to dial down the escalating situation in the region.
The ongoing conflict in Iran has delayed the complete reopening of the Strait of Hormuz, a critical passage for more than 20 per cent of global oil trade. Further disruption to the waterway could tighten global energy supplies.
Market analysts and geopolitical risk experts suggest that while the recent escalations risked the ceasefire and the peace memorandum signed by both parties, there are marginal chances of both sides returning to full-scale conflict.
Comments from US President Donald Trump, stating that he did not expect the conflict to escalate into a prolonged war, also helped ease fears of a wider regional disruption.
While the risk remains, demand for crude oil is showing some decline, which is also contributing to the price fluctuations.
In the United States, unemployment claims declined last week, suggesting the labour market remains resilient despite slower hiring trends.
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