Oil prices edged higher on Friday, buoyed by tightening supply and robust seasonal demand, as geopolitical tensions added further pressure to an already constrained market.
Brent crude futures rose 29 cents to $69.81 a barrel, while U.S. West Texas Intermediate (WTI) climbed 27 cents to $67.81. This slight uptick followed a $1 surge on Thursday, driven by a series of drone attacks on oilfields in northern Iraq’s semi-autonomous Kurdistan region, which forced a cut of nearly half the region’s output—from 280,000 to roughly 140,000–150,000 barrels per day (bpd).
The attacks, suspected to be carried out by Iran-backed militias, have not been claimed by any group but have significantly disrupted the region’s production. However, Iraq’s federal government has announced plans to resume oil exports from Kurdistan through a key pipeline to Turkey, ending a two-year halt.
Market fundamentals remain tight, with strong travel demand during the Northern Hemisphere’s summer playing a crucial role. JPMorgan reports global oil demand at 105.2 million bpd in the first two weeks of July—up 600,000 bpd year-on-year and in line with forecasts.
“Crude prices have remained stable overall this week as strong U.S. demand offsets OPEC+ supply increases,” said Anh Pham, analyst at LSEG.
Data also showed a sharp decline in U.S. crude inventories, reflecting higher export volumes. Meanwhile, Asia is witnessing a demand rebound as refineries return online from maintenance.
According to ING analysts, the market is expected to remain tight through Q3, before easing towards the end of the year as production ramps up and summer demand fades. However, unresolved issues such as U.S. tariff policies and planned rollbacks of production cuts by major oil producers add a layer of uncertainty.
Oil Prices Climb on Strong Demand, Easing Trade Tensions
Despite this week’s minor gains, Brent and WTI were still down over 1% on a weekly basis.
As global dynamics continue to shift, all eyes remain on Middle Eastern developments and U.S. policy decisions, both of which could sharply influence oil markets in the weeks ahead.