Oil Prices Wobble As a Week of Hostilities Derails Shipping

Oil prices flitted between modest gains and losses on Friday, a spell of relative calm at the end of a turbulent week in which rounds of military strikes around the Persian Gulf threatened to shatter a fragile truce between the United States and Iran.The burst of back-and-forth retaliations, which appeared to pause on Friday, has derailed a recovery in shipping traffic in the Strait of Hormuz, with the fewest ships in weeks braving the passage.Iran asserts that ships must obtain its permission to navigate the waterway, which normally carries a fifth of the world’s oil, while the United States insists that vessels should be able to pass freely.

The latest turmoil, sparked by attacks on three commercial ships in the strait on Tuesday, pushed the price of crude back above prewar levels.Oil fluctuates as fewer ships pass through the Strait of Hormuz.Brent crude, the international oil benchmark, hovered around $76 per barrel on Friday.It started the week at about $72 a barrel, near its prewar price.

Although the cost of crude is now about 5 percent higher than the start of the war, it is down from a peak of nearly $120 a barrel during the worst of the fighting.World oil demand is projected to decline this year for the first time since 2020, the International Energy Agency said in its monthly report on Friday, with a decline of 1 million barrels a day in 2026 compared with the previous year.Just 22 ships passed through the Strait of Hormuz on Thursday, according to Kpler, a maritime data company, down from 49 on Tuesday, the day the latest strikes began.Thursday’s traffic was the lowest since June 17, when a preliminary cease-fire was agreed between the United States and Iran.

Before the war, more than 130 ships navigated the strait on an average day....