Oil prices slipped in early Asian trading on Friday as hopes for a Middle East ceasefire took some of the heat off the market. After the U.S. helped broker a 10-day truce between Israel and Lebanon, things have quieted down—no major strikes for almost a week. That’s a big change for a region that’s usually on edge.
On top of that, talk is swirling about possible U.S.-Iran negotiations. Washington's making some noise toward diplomacy, and that’s chipping away at the usual war-related “risk premium” built into crude prices.
With all of this, both Brent and WTI are on track for a second weekly drop in a row, each down over 3% already this week.
But it’s not just politics nudging oil down. Worries about softening global demand are starting to pile up. Both the International Energy Agency and OPEC say world oil consumption might slow over the next few months, which just adds to the pressure.
And don’t forget the Strait of Hormuz. Even though things seem calmer, oil shipments through this crucial waterway—about a fifth of the world’s supply—are still lagging. Disruptions and a strong U.S. naval presence haven’t let up yet.
So now, the market’s not as jumpy about supply shocks, but persistent worries about weak demand and complicated geopolitics are keeping oil under the microscope.