Oil prices set for weekly gain amid Middle East tensions

Oil prices edged lower on Friday, October 16, 2026, but remained on track to post weekly gains as escalating geopolitical tensions in the Middle East and tightening United States crude inventories continued to fuel concerns over global supply.

Brent crude futures slipped 50 cents, or 0.47 per cent, to $105.42 per barrel, while U.S. West Texas Intermediate (WTI) crude fell 49 cents, or 0.50 per cent, to $97.48 per barrel in early trading.

The decline came after a strong rally earlier in the week, leaving Brent up about 0.5 per cent and WTI rose to 5.91%.

WTI had climbed more than 3% on Thursday, October 15, following a sharp drawdown in U.S. crude stockpiles caused by hurricane-related production disruptions.

“Uncertainty in the Middle ​East and concerns over the sustainability of oil flows through the Strait of Hormuz has the ⁠market pricing in a significant risk premium,” ING analysts said in a note.

The analysts added that confidence in oil markets would likely improve only if the United States and Iran reached an agreement capable of ensuring uninterrupted crude exports from the region.

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Concerns over supply have intensified after attacks around the Strait of Hormuz increased over the past 10 days. Iran has also stepped up military action in response to the U.S. blockade of its ports and tougher sanctions imposed last month, raising fears of prolonged disruptions to global energy flows.

Data from ship-tracking firm Kpler showed that crude movements through the Strait of Hormuz averaged 11.62 million barrels per day in the seven days to October 13, significantly below the normal baseline of 17.15 million barrels per day.

Kpler said the surge in Iranian attacks had sharply reduced Gulf oil exports and warned that recovery in shipping volumes could remain slow and uneven without a broader political settlement.