Oil prices edged up on Friday on reports Iran was preparing a retaliatory strike on Israel from Iraq in coming days, but record U.S. output weighed on prices.
Brent futures were up 29 cents, or 0.4%, to settle at $73.10 a barrel. U.S. West Texas Intermediate (WTI) crude gained 23 cents, or 0.3%, to settle at $69.49. At their session highs, both benchmarks were up over $2 a barrel.
Brent posted a weekly decline of about 4% with WTI down about 3%.
On Thursday, U.S. news website Axios reported that Israeli intelligence suggests that Iran is preparing to attack Israel from Iraq within days, citing two unidentified Israeli sources.
«Any additional responses from Iran might remain restrained, similar to Israel’s limited strike last weekend, hence primarily intended as a demonstration of strength rather than an invitation to open warfare,» said SEB Research analyst Ole Hvalbye.
Iran and Israel have engaged in a series of tit-for-tat strikes within the broader Middle East warfare set off by fighting in Gaza. Previous Iranian air attacks on Israel on Oct. 1 and in April were mostly repelled, with only minor damage.
Iran is a member of the Organization of the Petroleum Exporting Countries (OPEC) and produced about 4 million barrels per day (bpd) of oil in 2023, U.S. Energy Information Administration data showed.
Iran was on track to export around 1.5 million bpd in 2024, up from an estimated 1.4 million bpd in 2023, according to analysts and U.S. government reports.
Iran backs several groups that are currently fighting Israel, including Hezbollah in Lebanon, Hamas in Gaza and the Houthis in Yemen.
A U.S. official asked Lebanon to declare a unilateral ceasefire with Israel to revive stalled talks to end Israeli-Hezbollah hostilities, a senior Lebanese political source and a senior diplomat said – a claim denied by both sides.
Oil prices were also supported by expectations OPEC+ could delay December’s planned increase to oil production by a month or more on concern over soft oil demand and rising supply. A decision could be made as early as next week.
OPEC+ includes OPEC and its allies like Russia and Kazakhstan.
As OPEC+ holds back on production, U.S. oil major Exxon Mobil(XOM.N), opens new tab said its global output hit an all-time high, while Chevron (CVX.N), opens new tab said its U.S. production hit a record high.