Brent crude prices pulled back from a previous gain and dropped almost $2 on Friday after the White House added a delay to its decision on US involvement in the Israel-Iran tensions.
By 02:55 GMT, Brent crude futures were down $1.89, or 2.4%, at $76.96 a barrel, but remained about 3.8% higher on the week.
US West Texas Intermediate crude for July, which did not trade on Thursday because of a holiday, was up $0.53, or 0.7%, at $75.67 a barrel.
Earlier on Thursday, prices spiked by nearly 3% after Israel struck what it called nuclear-related sites in Iran, and Iran responded with missile and drone attacks on Israel following an overnight strike on an Israeli hospital. The week-old clash between the two countries showed no signs of easing.
However, gains were trimmed on Friday when the White House press secretary said President Donald Trump would decide within the next two weeks whether to commit U.S. forces to the Israel-Iran fight.
“Oil prices surged amid fears of increased U.S. involvement in Israel’s conflict with Iran. However, the White House press secretary later suggested there was still time for de-escalation,” said Phil Flynn, an analyst at The Price Futures Group.
Iran, a member of the Organization of the Petroleum Exporting Countries, extracts about 3.3 million barrels of crude oil each day, making it the group’s third-largest producer.
Roughly 18 million to 21 million barrels per day of oil and oil products pass through the Strait of Hormuz along Iran’s southern coast. Traders and analysts worry that any widening of the conflict could disrupt shipments and tighten global supplies.
“The ‘two-week deadline’ is a tactic Trump has used in other key decisions. Often these deadlines expire without concrete action, which would see the crude oil price remain elevated and potentially build on recent gains,” noted Tony Sycamore, an analyst at IG.
US stock futures slipped on Thursday eve
US stock futures slipped on Thursday evening as investors weighed the prospect of US military involvement in the Israel-Iran war and a two-week deadline set by President Trump for a decision on entering the conflict.
Dow Jones Industrial Average futures fell more than 0.4%, while S&P 500 and Nasdaq 100 futures dipped roughly 0.3%. Markets were closed on Thursday for Juneteenth, giving traders a pause as global news grew tense.
On Wall Street, investors were also digesting remarks from Federal Reserve Chair Jerome Powell. After the Fed kept interest rates unchanged on Wednesday, Powell said policymakers were not in a hurry to cut rates and would base decisions on incoming data. According to CME Group, most traders expect a rate cut by the Fed’s September meeting.
President Trump renewed his criticism of Powell on Thursday, accusing him of costing the US “hundreds of billions of dollars” by keeping rates high. He added a personal attack, calling Powell “one of the dumbest, and most destructive, people in Government.”
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