Key Points
- Brent gains 6.4pc, WTI rises 5.7pc on week
- Both benchmarks hit one-month high
ISLAMABAD: Oil prices extended their second consecutive weekly gains as the unresolved US-Iran conflict and severely reduced shipping through the Strait of Hormuz heightened concerns over global crude supplies.
Brent crude, the global benchmark, settled at $94.39 a barrel on Friday, gaining 61 cents on the day and 6.39 per cent over the week.
US West Texas Intermediate (WTI) crude rose 23 cents to $87.06 a barrel, up 5.66 per cent for the week, according to the market data published by multiple media outlets.
Both benchmarks had touched their highest levels since July 24 during the previous session.
The latest weekly advance followed a 5.9 per cent rise in Brent and a 5.4 per cent increase in WTI in the previous week. It had already extended a sharp recovery from early-August levels. Brent had settled at $88.52 and WTI at $82.40 on August 14.
Oil price drivers
The main driver remained the Strait of Hormuz, through which nearly one-fifth of global crude oil and liquefied natural gas shipments normally pass.
Ship-tracking data showed only seven commodity vessels crossed the waterway on Thursday, down from nine on Wednesday. No large crude carriers or liquefied natural gas tankers were recorded, as Hormuz shipping remained in single digits during the week under review.
US President Donald Trump’s threat of tougher sanctions on countries trading with Iran added another layer of supply uncertainty.
Iran warned that any new US measures would draw a “devastating” response, keeping markets alert to the possibility of further disruption.
Iran has also warned the countries against joining the US move of imposing tougher sanctions against Tehran, saying that they would be considered as enemies.
READ ALSO: Stalled Iran-US talks keep oil prices high, Hormuz shipping slow
Some relief emerged over the weekend after Iran granted special permission for several Iraqi oil tankers to transit Hormuz, but overall traffic remains far below normal.
For the week ahead, oil markets are likely to remain highly sensitive to developments around Hormuz. Oil traders should watch US sanctions, Iranian reaction, and any signs of progress-or further deterioration-in US-Iran diplomacy.
Oil track in 2026
The oil market has gone through one of its most volatile periods in recent years in 2026, with prices repeatedly moving by tens of dollars a barrel as the outlook for Middle East supply shifted.
Brent crude began the year in the mid-$60s, with prices initially supported by geopolitical tensions but still relatively contained.
The outbreak of the US-Iran war in late February changed the market sharply, as attacks on energy infrastructure and disruption to oil flows through the Strait of Hormuz raised fears of a prolonged global supply shock.
Brent entered the second quarter above $100 a barrel and climbed to a quarterly high of $118 in late April, according to the US Energy Information Administration (EIA).
The EIA said average daily movements in Brent during April and May were around $4 a barrel, compared with about $1 during the same months of 2025.
The market then staged an equally dramatic reversal. Expectations of a ceasefire and a US-Iran agreement increased the prospect of renewed shipping through Hormuz and the return of shut-in production.
Brent fell more than $40 from its early-April peak during May and June, reaching around $68 a barrel in early July.
That optimism proved short-lived. Renewed fighting and attacks on tankers in July again restricted shipments through Hormuz, sending Brent to around $105 on July 23. The benchmark ended July at $96.80, marking a rise of more than $25 during the month.
The International Energy Agency described July’s trading range of almost $40 a barrel as exceptionally wide, reflecting rapid changes in expectations over the conflict and oil supply.
The swings have also been reflected in physical supply. Global inventories have also been heavily drawn down, adding to concerns about the market’s ability to absorb another prolonged disruption.
By August, the market had therefore moved from a war-driven surge above $100, through a diplomatic-driven collapse towards $70, and back into the $90s as the conflict and shipping disruptions persisted.
Brent’s latest settlement of $94.39 on August 21 leaves the benchmark roughly 40 per cent above its early-year level. It reflects how geopolitical developments rather than conventional supply-and-demand factors have dominated oil pricing for much of 2026.
